We have freight inwards and freight outwards thru GTA. How much Service Tax is to be paid by us.
Kunal Mittal (FINANCE OFFICER) (580 Points)
24 January 2014We have freight inwards and freight outwards thru GTA. How much Service Tax is to be paid by us.
parveen kumar
(MBA)
(173 Points)
Replied 24 January 2014
Hello you can calculate on 3.09% on total assessable value.
regards
parveen
Siddharth Nigam
(Chartered Accountant)
(32 Points)
Replied 24 January 2014
I agree.
Service tax liability in your hands will be 100% under reverse charge mechanism. Abatement allowed for GTA service is 75%. Payments made by you to goods transport agency will attract service tax @ 12.36% on 25% value charged by GTA. Effective rate will come to 3.09% but please take care while filing returns as these days returns are getting rejected because of using such shortcut rates. Please remember .. there is only one rate of service tax i.e 12.36%.
Regards,
Sid
kosigi.prabhakar
(Senior Article Assistant)
(61 Points)
Replied 24 January 2014
Kunal Mittal
(FINANCE OFFICER)
(580 Points)
Replied 26 January 2014
I didnt get it..... Does that mean that the balance 12.36 % - 3.09 % is to be paid by the transporting agency.
Siddharth Nigam
(Chartered Accountant)
(32 Points)
Replied 26 January 2014
That is abatement part .. nobody is liable to pay tax on that ... consider the exampe below ...
Bill Amount Rs 1000
Less Abatement Rs 750
Taxable Amount Rs 250
Liability of GTA Service provider = NIL
Liability of GTA service receiver under reverse charge = 12.36% of Rs 250 = Rs 30.90/-
Manoj Agarwal
(Service Tax Consultant Rourkela ServiceTaxExpert@yahoo.com)
(3456 Points)
Replied 27 January 2014
For getting more clarity on GTA, kindly read my Article, which also got published by CENTAX Publication in R.K. Jain's Service Tax Review STR dated 15-01-2014.
https://www.caclubindia.com/articles/service-tax-on-gta-a-guide-19063.asp
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