We are a firm hiring/renting buses to companies with our own buses on contract, payment for which we receive monthly. we also use the servces of other buses not owned by us on certain routes. we charge the co service tax with abatement i.e @ 4.12%. we pay the service tax for our buses as well as of the other buses to the deaprtment. 1 sub contactor has asked me the hiring charges along with service tax. How can i pay him as i am already paying the full service tax recd from the co. for mine & his bus as well to the department. Kindly help
Your firm should be pay hiring charges along with service Tax(ST) to sub-contractor bcz he has collected ST on the service provided by him(your firm is Customer for him) and you'r collected & paid ST on service provided by you to your customer. You have'nt paid ST of Sub-contractor.
Further you are not eligible to Set of Input Service bcz you are claiming abatement for your ST liabilities.
CAclubindia
