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Sunil (CA) 16 October 2019
RCM is applicable on vehicle hire charges w.e.f 01st October, 2019 for any body corporate located in the taxable territory if such services is received from any person other than a body corporate, paying central tax at the rate of 5% on renting of motor vehicles with input tax credit only of input service in the same line of business.
So vehicle hire charges incurred by a company will be liable to RCM, if the service is taken for any person other than another body corporate in the similar business charging GST @ 5%.
Please note “Body Corporate” has the same meaning as assigned to it in clause (11) of section 2 of the Companies Act, 2013.
Please read notification 22/2019 Central Tax Rate notification.