TaxTMI 
TaxTMI 
TaxTMI 
Sir
Our manufacturing is going to engage Labour Contractor for supplying labour. I would like to know under RCM whether our company is bound to pay 15% of 75% or 15% of 100%. Please advice me.
With thanks
Samik Chaudhuri.
Labour contract
Samik Chaudhuri
Reverse Charge Mechanism: Service Receiver Pays 100% Service Tax on Labor Contracts per Notification No. 07/2015. A discussion on a forum addresses a query about the Reverse Charge Mechanism (RCM) for service tax on labor contracts. The original question asks whether a company should pay 15% of 75% or 15% of 100% under RCM. The consensus, clarified through multiple replies, is that as per Notification No. 07/2015, effective from April 1, 2015, the service receiver is responsible for paying 100% of the service tax. The discussion highlights the importance of clear query formulation to avoid misunderstandings and ensure accurate responses. (AI Summary)