Gst on bus services

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 November 2017 we want to start Bus Services business either one or all:
1. School Bus services for pick & drop students
2. Private passengers services- fare not more than Rs. 100/- per passengers
3. Private bus booking- fare more than 5k for whole bus booking
4. State carriage bus services

my question is GST Registration mandatory for all cases
What is GST Rates applicable
What is SAC Code
can we claim Composition Scheme

please reply soon. Thanks in advance

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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20 November 2017 1 GST not applicable on school bus.
2 GST applicable in case of AC bus.
3 and 4 5% GST applicable in case of AC bus.

Querist : Anonymous

Querist : Anonymous (Querist)

20 November 2017 sir, please also share SAC Code for such bus services.

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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26 July 2024 ### GST on Bus Services: Detailed Information

#### **1. GST Registration Requirements**

**a. **GST Registration:**

- **Mandatory Registration:**
- GST registration is mandatory if the aggregate turnover exceeds Rs. 20 lakhs (Rs. 10 lakhs for special category states). For bus services, registration is typically required if the business is making taxable supplies, except for certain exempt categories.

#### **2. GST Rates Applicable**

**a. **School Bus Services:**

- **GST Rate:**
- School bus services are generally exempt from GST. According to the GST Notification No. 12/2017-Central Tax (Rate), transportation of students to and from educational institutions is exempt from GST.

**b. **Private Passenger Services (Fare ≤ Rs. 100 per passenger):**

- **GST Rate:**
- For bus services with a fare of Rs. 100 or less, the GST rate is 5% (2.5% CGST + 2.5% SGST), as per GST Notification No. 11/2017-Central Tax (Rate).

**c. **Private Bus Booking (Fare > Rs. 5000 for whole bus):**

- **GST Rate:**
- Private bus booking where the fare is more than Rs. 5000 for the entire bus is also subject to a 5% GST rate (2.5% CGST + 2.5% SGST), as specified in GST Notification No. 11/2017-Central Tax (Rate).

**d. **State Carriage Bus Services:**

- **GST Rate:**
- State carriage services, provided by state transport undertakings, are exempt from GST under GST Notification No. 12/2017-Central Tax (Rate).

#### **3. SAC Code for Bus Services**

- **SAC Code:**
- For bus services, the relevant SAC (Services Accounting Code) is **9964**. This code covers various types of transportation services including passenger transport services.

#### **4. Composition Scheme Eligibility**

- **Composition Scheme:**
- The Composition Scheme is not available for service providers, including those providing bus services. The Composition Scheme is only available for manufacturers and traders of goods (not for service providers), as per GST provisions.

#### **Summary of Key Points:**

1. **GST Registration:**
- **Mandatory** if aggregate turnover exceeds Rs. 20 lakhs (Rs. 10 lakhs for special category states) for providing taxable bus services.

2. **GST Rates:**
- **School Bus Services:** Exempt from GST.
- **Private Passenger Services (Fare ≤ Rs. 100):** 5% GST (2.5% CGST + 2.5% SGST).
- **Private Bus Booking (Fare > Rs. 5000):** 5% GST (2.5% CGST + 2.5% SGST).
- **State Carriage Bus Services:** Exempt from GST.

3. **SAC Code:**
- **9964** (for various types of transportation services including bus services).

4. **Composition Scheme:**
- **Not applicable** to service providers, including bus service providers.

### **Example Scenarios:**

- **Scenario 1: School Bus Services**
- **Service:** Pick & drop services for students.
- **GST Rate:** Exempt.

- **Scenario 2: Private Passenger Services**
- **Service:** Fare of Rs. 80 per passenger.
- **GST Rate:** 5% (2.5% CGST + 2.5% SGST).

- **Scenario 3: Private Bus Booking**
- **Service:** Booking a whole bus for Rs. 6000.
- **GST Rate:** 5% (2.5% CGST + 2.5% SGST).

- **Scenario 4: State Carriage Bus Services**
- **Service:** Bus services provided by state transport.
- **GST Rate:** Exempt.

### **Action Steps:**

1. **Ensure GST Registration** if providing taxable services and turnover exceeds the threshold limit.
2. **Apply the correct GST rate** based on the nature of the bus service.
3. **Use SAC Code 9964** for reporting in GST returns.
4. **Understand that the Composition Scheme is not available** for service providers.

For precise compliance and any specific issues, consulting with a GST advisor or tax professional is recommended.