18 July 2020
Dear Experts Say, I have engaged one service provider to hire services of a computer operator/ data entry operator. I have to pay Rs. 10,000/- to the computer operator towards his salary through the service provider. I have made an agreement with the service provider to pay him 2% service charges of salary of computer operator. I have to pay 10% EPF and 3.25% ESI to the service provider as employers liability of EPF and ESI and he will pay the same to the computer operator account. The service provider prepared the bill as follows - 1. Salary of c. operator = 10000 2. EPF 10% on salary = 1000 3. ESI 3.25% on salary = 325 4. Service charges 2% = 200 5. Total of items sr. no. 1 to 4 = 11525 6. GST amount = ? Rate of GST ? Should I calculate GST on Sr. No. 5. ie aggregate of (salary + EPF+ESI+Service charges) Rs. 11525 or Should I calculate GST on Sr. No. 1. only on Rs. 10000 ? or Should I calculate GST on Sr. No. 4. only on Rs. 200? or Should I calculate GST on sum of Sr. No. 1 & 4. (Salary amount 10000 + service charges 200) on Rs. 10200? Please suggest with relevant rule. Regards.
18 July 2020
GST will be payable on Rs.11525/-.Refer section 15 of CGST Act for value of the supply.It says the transaction value, that is the price actually paid or payable for the said supply of goods and/or services. Here pure agent concept will also not apply for EPF/ESI because the amount will be deposited by the contractor (service provider) as employer.
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