Service tax on reimbursements

Hi,

In budget 2015, it was clarified that service tax would be applicable on Reimbursements but my ques is that if we have received seperate bills for gross amount & reimbursements, then also service tax will be applicable on reimbursement bill?

Replies (1)

As per the amendment made by Finance Budget,2015 reimursement in resepect of out of pocket expenses incurred by s.provider shall form integral part of value of service.

It is because,that services cannot be provided in vaccum and thus,you cannot avoid charging tax on reimbursements by issuing separate invoice/ bill

 

 

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