Dear Sir,
We have received an invoice from a firm charging 15% (14%+0.5%+0.5%)service tax for the work done by them. The work they have done is welding work in the overhead crane rail . My question is whether i have to pay full tax to him or I have to pay 50% tax to the govt and ask the firm to pay the balance 50% or what is the procedure.
Kindly explain in detail.
Thanks & Regards,
S.Ramakrishnan
Welding Services on Crane Rails: Full Tax or Reverse Charge Mechanism? Clarifying Tax Payment and Valuation Rules. A user inquired about the appropriate service tax payment for welding work on overhead crane rails, questioning whether to pay the full tax or split it under the reverse charge mechanism (RCM). Respondents clarified that if the service is pure labor without material, RCM does not apply, and the full tax rate should be paid. However, when materials are provided by the service provider, the service falls under 'Works Contract Service,' and RCM applies, splitting the tax liability 50:50 between service provider and receiver. The final consensus was to educate the provider on applying the correct valuation rule. (AI Summary)
TaxTMI 
TaxTMI 
TaxTMI 
