Gta payments

Hello you can calculate on 3.09% on total assessable value.

regards

parveen

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

I didnt get it..... Does that mean that the balance 12.36 % - 3.09 % is to be paid by the transporting agency.

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/-

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