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Reverse charge

NIKHIL VERMA (ARTICLE ASSITANT) (66 Points)

11 December 2014

Dear All,

I am working in a realestate devloper company . We paid wages to labour on contract basis. Contrats are on measurment basis. We Measure there worrk done during the month and the pay there bill.All material is provided by our company

In this case are we liable to pay Reverse Charge on Manpower Supply

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6 Replies

Lalit Nyati (Student) (487 Points)
Replied 11 December 2014

Yes, Tax should pay under Supply of manpower service of RCM. Service Tax shall pay by your manpower suppler (SP) on 25% of value and Service tax shall pay by your employer co (SR) on 75% of value. it shall not work contract service because material provided by your employer company.

Lalit Nyati (Student) (487 Points)
Replied 11 December 2014

Yes, Tax should pay under Supply of manpower service of RCM. Service Tax shall pay by your manpower suppler (SP) on 25% of value and Service tax shall pay by your employer co (SR) on 75% of value.

it shall not work contract service because material provided by your employer company.

Soham (Learning ) (534 Points)
Replied 11 December 2014

Service provider : assumption Non Corporate

Service Receiver : Your Co ( Corporate )

Type of Service : Supply of Manpower / recruitment agency

Assumption : Invoice is purely For labour and no Vat Chargeable goods are included as part of service

your Company's Liability : 75 % of 12.36 % = 9.270%

vendor's Liability : 25% of 12.36% =3.09% ( chargeale in Invoice)

nishagopal (Articled clerk) (23 Points)
Replied 12 December 2014

Rcm is applicable only when service provider is non corporate and also pls note piece basis or job basis contract is not manpower supply service.

viral (CA) (23 Points)
Replied 14 December 2014

Its not necessary that all the payment to contractual labour becomes automatically payment for supply of manpower. Full facts, actual paper work and actual mode of payment needs to be seen. Answer may differ on case to case basis.

SANTHOSH. ASHOK (Auditor & Tax Consultant) (278 Points)
Replied 17 December 2014

“Supply of manpower” means supply of manpower, temporarily or otherwise, to another person to work under his superintendence or control.’ [Rule 2(g) of Service Tax Rules, Inserted w.e.f. 1-7-2012

Services Such as Security service, cleaning service, piece basis or job basis contract can be ‘manpower supply service’ only if the labour work under superintendence or control of Principal Employer.

In cases if Person approaching himself and company appointing him on contract basis is not manpower supply service.

So as per Info given Service is received by Company & the worker are in direct control of the company & not any other persons. So in this regards there No service tax applicability.