Service tax on service charge

This query is : Resolved

naresh rawat (Querist)
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13 October 2014
One of our Manpower contractor is supplying for our use. he is charging 12% service charges on cost of the manpower supplied further after adding cost of the manpower & service charges. he is charging service tax @12.36.

Should he not charged service tax on the service charges only (not on the cost of the manpower)

Kindly advice

CA Devanand Jethanandani

CA Devanand Jethanandani (Expert)
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16 October 2014 Contractor is charging service tax correctly.

Service tax is applicable on whole amount (i.e. manpower cost + service charge)

Thanks