Dear All,
Please let me know the provision of service tax applicability on bonus payments by employer to manpower contractor for distribution to casual labor of bonus against contractor bill.
scenario also under Reverse Charge mechanism, and relevant referance/proviosn , of rules.
Regards
Rakesh Palwial
Service Tax Applies to Bonus Payments Under RCM for Casual Labor per Section 67 of Finance Act A query was raised regarding the applicability of service tax under the Reverse Charge Mechanism (RCM) on bonus payments made by an employer to a manpower contractor for distribution to casual labor. Multiple contributors confirmed that service tax is applicable on such payments, citing Section 67 of the Finance Act, which defines such bonuses as 'consideration.' Despite some conflicting judgments by CESTAT, the consensus is that the law is clear on this matter. Contributors emphasized the importance of understanding and adhering to the law, suggesting that proper legal interpretation can ultimately lead to favorable outcomes in litigation. (AI Summary)
TaxTMI 
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