Service tax on gta

Queries 771 views 4 replies

Dhana

Financial Analyst

41 Points Joined July 2011

Hi all,

Who shall be made liable to pay service tax on GTA when the freight charges had been paid by an Individual/ HUF, and the consignor is a specified person under rule 2(1)(d)(v) of Service Tax Rules?

In similar lines will the consignor being an Individual/ HUF be made liable for the Service Tax on GTA in case he reimburses the freight charges to the consignee who shall be a specified person as mentioned above?

Will the GTA itself be made liable for the Service Tax liability when both consignor and consignee are either Individual or HUF?

Kindly give ur valuable inputs

Replies (4)

Nirav Worah

CHARTERED ACCOUNTANT

396 Points Joined August 2010

The words consignor or consignee has been replaced by person liable to pay freight. If the person liable to pay freight is in the specified category then reverse charge will apply. However, if the person paying the freight is an individual then reverese charge will not apply and service tax liability is on the GTA. Hence, the only case where the liabilty is on GTA is when the person liable to pay is an individual or HUF.

Dhana

Financial Analyst

41 Points Joined July 2011

Then all the consioners can give "To Pay" to the consinees to shift the liablity on GTA na??

Kavya

CA Final Article

32 Points Joined October 2011

What will be the case if individual reimburses for the freight paid by the company? who shall be liable for Service Tax in this case since the actual payment had been made by the company and only reimbursement had been made by an individual?

Kindly clarify

Ganeshbabu K

Audit and Tax Advisory

48564 Points Joined May 2012

1)GTA-OUT WARD:-

In sale contract terms with customer if you make customer is liable nad frieght could be on To pay..company not required to pay GTA. if any case happens like company has to pay he is only paying on behalf of customer and customer alone would be liable.The person liable to pay is required to comply..

2)GTA-INWARD:

If you have entered into purchase contracts /terms in a way making supplier is liable to pay frieght or frieght is inclusive SO SUPPLER WILL BE LIABLE TO PAY GTA AND NOT PURCHASER COMPANY.

if purchaser company paid it would be only behalf of supplier so that supplier is liable to pay GTA