Service Tax - Business Support Service

We are porviding the service to our client for clearance of B.L. and we are doing this work from third party.

Say my company's name is B and i am providing service to A and work done from C.

C charges in his invoice various expenses like ocean frieght, Terminal Handlling Charges, Piracy Risk , Documentation Charges etc.

My company is charging a fix amount over invoice of C and issue debit note to A.

My question is, can i issue one debit note for re-imburssement of expense and charge no Service Tax on the same and another debit note for Service charges on which i charge Service Tax or I have to charge Service Tax on the full amount (i.e. Expenses + Service Charges)

We have Registration in Business Support Service.

Replies (3)

 

Yes you should issue a debit note of reimbursement of expenses from the behalf of C

And you should also charge service tax on reimbursement of expenses.

Service Tax is a Value added Tax. Therefore service tax should be applied on your service charge and not on reimbursement of expenses (since the service will already be charged to tax).

From billing point-of-view, you have two alternatives:

1. One as you have mentioned 1st bill - reimbursement (without ST), 2nd bill - Service charge (with ST).

or

2. One bill with break-up of Reimbursement expnese and chargeable service, with only the ST being charged on service alone.

Hope this helps !

Originally posted by : bhavin


We are porviding the service to our client for clearance of B.L. and we are doing this work from third party.

Say my company's name is B and i am providing service to A and work done from C.

C charges in his invoice various expenses like ocean frieght, Terminal Handlling Charges, Piracy Risk , Documentation Charges etc.

- C raise invoice to "?" if C raise invoice to A then u have to raise only your charges invoice / debit note, service tax may apply after limit of 10L

- if C raise invoice to "B" then B has to take credit of service tax on invoice of C and then issue invoice to A and service tax payable on this bill gross.

- mere payment by you on behalf of A does not qualify you as receipent of service, but u have to chek carefully the documents eligibility . 


My company is charging a fix amount over invoice of C and issue debit note to A.

My question is, can i issue one debit note for re-imburssement of expense and charge no Service Tax on the same and another debit note for Service charges on which i charge Service Tax or I have to charge Service Tax on the full amount (i.e. Expenses + Service Charges)

We have Registration in Business Support Service.

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