Calculation of GST in a bill of labur engaged.

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Calculation of GST in a bill of labur engaged.

Ajay Pal • 18 July 2020

Dear Experts Say, I have engaged one service provider to hire services of a computer operator/ data entry operator. I have to pay Rs. 10,000/- to the computer operator towards his salary through the service provider. I have made an agreement with the service provider to pay him 2% service charges of salary of computer operator. I have to pay 10% EPF and 3.25% ESI to the service provider as employers liability of EPF and ESI and he will pay the same to the computer operator account. The service provider prepared the bill as follows - 1. Salary of c. operator = 10000 2. EPF 10% on salary = 1000 3. ESI 3.25% on salary = 325 4. Service charges 2% = 200 5. Total of items sr. no. 1 to 4 = 11525 6. GST amount = ? Rate of GST ? Should I calculate GST on Sr. No. 5. ie aggregate of (salary + EPF+ESI+Service charges) Rs. 11525 or Should I calculate GST on Sr. No. 1. only on Rs. 10000 ? or Should I calculate GST on Sr. No. 4. only on Rs. 200? or Should I calculate GST on sum of Sr. No. 1 & 4. (Salary amount 10000 + service charges 200) on Rs. 10200? Please suggest with relevant rule. Regards.
Replies (2)
Quick Summary
This discussion addresses how to calculate Goods and Services Tax (GST) on a bill for engaged labour services. The user is seeking clarification on whether GST should be applied to the total bill amount, just the salary, only the service charges, or a combination. Experts advise that GST should be paid on the entire sum, as the service provider is supplying skilled manpower.

GST shall be paid on whole sum of 11525

The service provider has provided service for data entry considering the details provided it seems to be a supply of skilled manpower for which he is charging u a sum of 11525 . 

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