Service tax charge by hospitals

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We are employer (business entity:- Company)
One of Our paneled Hospital is charging service tax on us on all tests , consultancy fee, OT charges etc (excluding medicine and
consumables) provided to our employees.

Kindly advise whether service tax charged by hospital is correct or not as Sec 65(105) (zzzzo) propose payment in relation to Health check up and preventive care.

Please also advise whether we can avail cenvat credit of the same or not


Replies (3)

 

Yes  you can get avail credit

Section 65(105)(zzzzo) of Finance Act 1994 is made w.e.f. 01.07.2010 as per which Service Tax is payable by any hospital, nursing home or multi-specialty clinic,—

  • (i) to an employee of any business entity, in relation to health check-up or preventive care, where the payment for such check-up or preventive care is made by such business entity directly to such hospital, nursing home or multi-specialty clinic; or
  • (ii) to a person covered by health insurance scheme, for any health check-up or treatment, where the payment for such health check-up or treatment is made by the insurance company directly to such hospital, nursing home or multi-specialty clinic;

But in the Memorandum explaining the provisions of the Finance Bil 2010, health check up undertaken by hospitals or medical establishments for the employees of business entities are covered by Service Tax

Yes ,u can avail service tax credit for above ..........

Thanks for reply

But please confirm whether Service tax charged by hospital on all services (tests , consultancy fee, OT charges etc ) is correct or not


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