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Payment to labourer under Reverse Charge Mechanism??

13 September 2017

We are providing handling(Loading /Unloading Services) to company for which we are charging 18% GST on them and for providing services to them we make payment to labourers who are not permanently employed but on daily wages, do we have to Pay tax under Reverse Charge on payment made to labourers??

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3 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (161303 Points)
Replied 13 September 2017

"who are not permanently employed but on daily wages..........."

wages are not covered under GST....... So, No GST under RCM for wage payment to your worker.

Harsh Surana (Chartered Accountant) (51 Points)
Replied 13 September 2017

Dear,

There is exemption of Rs 5000 Per Day so if the amount relating to your unregistered labour is less than 5000 then same is allowed however if same is more than Rs 5000 then same will be liable under reverse charge mechanism and you have to pay GST on the same.

Regards