limit for deduction on carting expense
This query is : Resolved
01 July 2009
Is any charges to be deducted on carting expenses regarding service tax...if any then on how much amount....
02 July 2009
Am not able to understadn what is the question at all.
02 August 2024
### Carting Expenses and Service Tax/GST Deduction
**Carting expenses** typically refer to the charges related to transporting goods from one place to another. Whether these expenses are subject to service tax or GST and how they are treated can vary based on the context and applicable regulations.
#### **Under Service Tax Regime (Before GST Implementation)**
1. **Service Tax Applicability:**
- Under the Service Tax regime, transport services were taxable. The **Transport of Goods by Road Service** was subject to service tax. The liability to pay service tax could be either on the service provider (transport service provider) or under the reverse charge mechanism where the service recipient was liable.
2. **Deduction on Carting Expenses:**
- There was no specific limit or deduction on carting expenses itself. Instead, the focus was on the applicability of service tax and who was liable to pay it. Businesses could generally claim input credit on service tax paid on transportation services used for the business.
#### **Under GST Regime (Post-July 1, 2017)**
1. **GST Applicability:**
- Under GST, transportation services fall under the category of **Goods Transport Agency (GTA)** services, and the HSN code for transportation of goods is **9965**.
- **GST Rate for GTA Services:** As of the latest updates, the rate is generally **5%** (with no ITC allowed) or **12%** (with ITC allowed) depending on whether the service provider opts for the regular scheme or the composition scheme.
2. **Deduction on Carting Expenses:**
- **No Specific Deduction Limit:** There is no specific deduction limit for carting expenses under GST. The main concern is whether the GST on carting expenses is being paid correctly and whether ITC (Input Tax Credit) can be claimed if applicable.
- **Input Tax Credit (ITC):** If the service provider charges 12% GST and the recipient of the service is eligible to claim ITC, then ITC can be claimed for the GST paid on carting expenses.
3. **Reverse Charge Mechanism (RCM):**
- If the reverse charge mechanism applies, the recipient of the service (i.e., the person or business hiring the transportation service) is responsible for paying GST directly to the government. The amount and rate of GST should be as per the applicable rates.
4. **Documentation:**
- Ensure proper documentation and invoicing for carting expenses to comply with GST regulations. Maintain records to claim ITC and ensure that all applicable GST rates are being correctly applied.
For the most accurate information tailored to your specific situation, you should consult the latest GST notifications or seek advice from a GST professional.
**Carting expenses** typically refer to the charges related to transporting goods from one place to another. Whether these expenses are subject to service tax or GST and how they are treated can vary based on the context and applicable regulations.
#### **Under Service Tax Regime (Before GST Implementation)**
1. **Service Tax Applicability:**
- Under the Service Tax regime, transport services were taxable. The **Transport of Goods by Road Service** was subject to service tax. The liability to pay service tax could be either on the service provider (transport service provider) or under the reverse charge mechanism where the service recipient was liable.
2. **Deduction on Carting Expenses:**
- There was no specific limit or deduction on carting expenses itself. Instead, the focus was on the applicability of service tax and who was liable to pay it. Businesses could generally claim input credit on service tax paid on transportation services used for the business.
#### **Under GST Regime (Post-July 1, 2017)**
1. **GST Applicability:**
- Under GST, transportation services fall under the category of **Goods Transport Agency (GTA)** services, and the HSN code for transportation of goods is **9965**.
- **GST Rate for GTA Services:** As of the latest updates, the rate is generally **5%** (with no ITC allowed) or **12%** (with ITC allowed) depending on whether the service provider opts for the regular scheme or the composition scheme.
2. **Deduction on Carting Expenses:**
- **No Specific Deduction Limit:** There is no specific deduction limit for carting expenses under GST. The main concern is whether the GST on carting expenses is being paid correctly and whether ITC (Input Tax Credit) can be claimed if applicable.
- **Input Tax Credit (ITC):** If the service provider charges 12% GST and the recipient of the service is eligible to claim ITC, then ITC can be claimed for the GST paid on carting expenses.
3. **Reverse Charge Mechanism (RCM):**
- If the reverse charge mechanism applies, the recipient of the service (i.e., the person or business hiring the transportation service) is responsible for paying GST directly to the government. The amount and rate of GST should be as per the applicable rates.
4. **Documentation:**
- Ensure proper documentation and invoicing for carting expenses to comply with GST regulations. Maintain records to claim ITC and ensure that all applicable GST rates are being correctly applied.
For the most accurate information tailored to your specific situation, you should consult the latest GST notifications or seek advice from a GST professional.
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