Clarification regarding service tax credit on manpower servi

dear sir,

we are manufacturer and taking man power service for labour work from contractor (proprietor).

contractor charges us labour charge and 25% service tax under partial reverse charge in his bill on monthly basis against providing man power service .

now our question is that when can we take credit of the same 25% service tax which was charged by contractor (1) immediately on received bill from contractor (2) on or after the payment made of the said bill ?

 

 

Replies (2)

Dear Sir

As per Rule 4 (7) first proviso of the CENVAT credit rules, CENVAT credit in respect of input service shall be allowed on or after the day on which payment is made.

So, go through the aforesaid rule.

 

You can take credit of service tax when U received the bill under normal charges but under reverse charges undress and when U pay service tax U can take credit.

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