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Service tax on job work

CHANDAN (Accountant) (73 Points)

23 September 2016

our company is doing job work for other company. our company is liable for pay service tax or not, if liable for pay service tax what is the limit for service tax liability?

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4 Replies

Rajasekhar (Student CA Final ) (58 Points)
Replied 23 September 2016

Whether that job work is amounting to manufacture or not.

Mir Irshad Ali (Partner) (192 Points)
Replied 26 September 2016

If the activity of job work undertaken amounts to manufacture as per Central Excise Act, 1944, then no Service Tax is payable.

If the activity of job work undertaken does not amount to manufacture as per Central Excise Act, 1944, then no Service Tax is payable, if the principal manufacturer is paying duty on such job work goods.

If the activity of job work undertaken does not amount to manufacture as per Central Excise Act, 1944, and if the principal manufacturer is not paying duty on such job work goods, due to exemption of final product, etc, then Service Tax is payable.

chandra sekar (Manager-Accounts) (387 Points)
Replied 05 October 2016

suppose out of the total products completed thro job work, some products are exempted and some products are dutiable, then , what is the effect of service tax on job worker

chandra sekar (Manager-Accounts) (387 Points)
Replied 05 October 2016

one more doubt on service tax on job worker by the provider. if it is a work contract, shall we take 50 % of the value of service provided and pay ST ?