Freight - reverse charge mechanism
Sivaraman A R (.) (1040 Points)
24 February 2016Sivaraman A R (.) (1040 Points)
24 February 2016
CA. Ankit Bhandari
(Manager finance)
(156 Points)
Replied 24 February 2016
yes , their method is correct. in case they dont charge, you have to pay Service tax.
Arun choudhary
(articalship)
(153 Points)
Replied 24 February 2016
you can also give declration for non deductation of service tax.
CS Dhawni Chandan
(Assistant Company Secretary at MNC)
(9 Points)
Replied 24 February 2016
CA. Ankit Bhandari
(Manager finance)
(156 Points)
Replied 24 February 2016
w.e.f. 01/04/2015 it is 30% for Freight payments.
CS Dhawni Chandan
(Assistant Company Secretary at MNC)
(9 Points)
Replied 24 February 2016
kunal
(ca)
(64 Points)
Replied 24 February 2016
Rates are correct, but as service provider is a company, they have to pay service tax not service receiver.
Akshit Batra
(Partner)
(56 Points)
Replied 24 February 2016
Yes, the method of billing is correct. Also, the valuation of service @ 30% is also correct. And RCM will be applicable in this case if the supplier is charging service tax under GTA Service Category. Supplier being a body corporate is irrelevant here, Only the SR should be specified person for applicability of RCM.
Shadow
(FINANCE EXCUTIVE)
(241 Points)
Replied 24 February 2016
Akshit Batra
(Partner)
(56 Points)
Replied 25 February 2016
TDS is to be deducted at the time of payment/ crediting on amount excl. of service tax.
Madhukar N Hiregange
(Chartered Accountant)
(39034 Points)
Replied 25 February 2016
Under ST only the GTA is liable to ST and if the person liable to pay for the transpoirtation is the supplier then the company could pay ST on RCM and seek reimbursement from you if in terms of your contract.
However as a lump sum seems to be charged it may nto be the case. Who is issuing the consignment note for the goods reaching your factory you may se. Thjat would sehd a bit more light on this issue.
Sivaraman A R
(.)
(1040 Points)
Replied 26 February 2016
Dear sir,
A Ltd is supplier. Hanuman Transport is issuing Consignement Note to A Ltd. A Ltd pays to Hanuman Transport. We B Ltd has no connection with Hanuman Transport. Since our supplier paid to Hanuman Transport Rs 80000, he is reimbursing it from us Rs 80000 + ST @ 14.5%. GTA RCM comes only if we B ltd makes payment directly to Hanuman Transport. I think A ltd is correct in raising ST in his bill. Am I right?
Prashant Soni
(F&A Executive)
(23 Points)
Replied 27 February 2016
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