SERVICE TAX ON REIMBURSEMENT OF FREIGHT

[SUMEDH AYARE]

Dear Sir

 

As a service receiver whether i am liable to pay service tax on reimbursement of freight.

Details : Golden transport delivered the goods to us.

Golden tansport received payment from manufacturer of goods.

Manufacturer raised debit note in our favour (towards freight charges)

Regards

Sumedh 

[rajkumar shukla]

pl confirm whether you are showing such freight expenses in your P&l account.if not, you are not liable to pay.

[deepak gulati]

as per the provisions there is reverse charge in case GTA but basically the person who is liable to pay freight, will be liable to pay the service tax  it means if it is "freight to be paid built y" than the  service receiver is liable to pay ST and if it is "Fright paid built y" than receiver is not liable to pay ST.

 Thus in your case you are not required to pay ST.

Regards

Punit Bansal

 

AI Summary

Reverse charge for goods transport agency makes freight recipient liable for service tax where freight is payable by recipient. Liability for service tax on reimbursed freight depends on reverse charge for goods transport agency services: where freight is payable by the recipient, the recipient is liable to pay service tax; where freight is paid by the supplier, the recipient is not liable. Recording the freight expense in the recipient's profit and loss account may affect practical liability or accounting treatment.