Tax rate

This query is : Resolved

Share Report Follow Query Ask a Query

Ashish Khillan

Ashish Khillan (Querist)
Follow

17 July 2017 Dear Experts,
how much is the tax rate, for providing car service to the bank manager ?
thank you

Amit Goel

Amit Goel (Expert)
Follow

17 July 2017 IGST 18% or CGST 9% and SGST 9%

Message likes : 1 times

CA Rashmi Gandhi

CA Rashmi Gandhi (Expert)
Follow

17 July 2017 18%..............…......

Message likes : 1 times

Ashish Khillan

Ashish Khillan (Querist)
Follow

05 September 2017 Rashmi Mam, plz reply to my msg.

CA Rashmi Gandhi

CA Rashmi Gandhi (Expert)
Follow

05 September 2017 WILL REPLY AFTER CHECKING IT

Ashish Khillan

Ashish Khillan (Querist)
Follow

05 September 2017 Ok Mam, i wait thank you.

Message likes : 1 times

Ashish Khillan

Ashish Khillan (Querist)
Follow

06 September 2017 Mam, plz give time as soon as possible bcz 30 days time period is also elapse. have to do before option to reply is finished. thank you

Message likes : 1 times

Ashish Khillan

Ashish Khillan (Querist)
Follow

06 September 2017 just bcz of worried, i said it

Message likes : 1 times

CA Rashmi Gandhi

CA Rashmi Gandhi (Expert)
Follow

07 September 2017 Done it......

Message likes : 1 times

Ashish Khillan

Ashish Khillan (Querist)
Follow

22 October 2017 is GST rate for renting car service is chaged?.... and new rates are applicable from which month?

Ashish Khillan

Ashish Khillan (Querist)
Follow

03 November 2017 Dear Esperts, new gst rate is applicable from which month and is GST rate of providing car on rent to bank for manager purpose is changed? before it was 18%.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
Follow

26 July 2025 Here’s the latest **GST rate clarification** for providing a **car rental service to a bank manager**, as of FY 2025:

---

## 🚗 GST Rate on Car Rental Services in India

Car rental services fall under **Rental Services of Transport Vehicles (HSN/SAC 9966)** which cover services *with or without operators*.

### Two GST Rate Scenarios:

1. **GST @ 5% (CGST 2.5% + SGST 2.5%)**

* Applies when the **rental includes fuel cost** in the total consideration.
* **Input Tax Credit (ITC) cannot be claimed** on goods or services used to provide this service, except limited service-side ITC.
* Usually termed as **“rent-a-cab” service** with fuel-inclusive pricing.
([Vinod Kothari Consultants][1], [aktassociates.com][2], [Taxscan][3])

2. **GST @ 18% (CGST 9% + SGST 9%)**

* Applies when fuel cost is **not included separately** (i.e., customer bears fuel separately, or fuel cost is omitted).
* **Full ITC is available** for inputs used in providing the service.
([Taxscan][3], [aktassociates.com][2])

📌 Example:

* If you charge ₹1,00,000 including fuel → apply **5% GST**
* If fuel is billed separately or not included → apply **18% GST**

---

## 🔁 Reverse Charge Mechanism (RCM)

* If a **body corporate** (like a bank) procures `renting of motor vehicle with fuel included @5%`, the GST liability may **shift to the recipient** under **RCM**.
* You, as provider, should check if the service is provided to a corporate entity — then RCM might apply.
([TaxGuru][4], [Taxscan][3])

---

## ✅ In Your Case (Providing Service to Bank Manager):

* If the car service to the bank manager includes **fuel cost in fare**, the applicable GST is **5%**.
* If the bank manager is using a car from your fleet and paying you, and he is **employed by a corporate**, the GST may need to be accounted for under **RCM** (i.e., the bank may need to pay GST directly).
([carahulgupta.com][5])

---

### 📌 Quick Reference Table

| Scenario | GST Rate | ITC Allowed | RCM Applies to Corporate |
| ------------------------------------ | -------- | ---------------------------- | --------------------------------- |
| Car rental **includes fuel** in fare | 5% | No (except limited services) | Yes, if service to body corporate |
| Car rental **excludes fuel** | 18% | Yes | No |

---

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now