Hiring out vehicle to a GTA

[AMEY SHARMA]

We ourselves a GTA sometimes give on hire motor vehicles to other GTA along with driver and petrol exp

is our service exempt under gst 12/2017?

[KASTURI SETHI]

Yes. Exempted. See serial no.22 of Notification No.12/2017-CR(Rate) dated 28.6.17 as amended. Relevant extract of notification is as follows:

Services by way of giving on hire - NIL

(b) to a goods transport agency, a means of transportation of goods.

[AMEY SHARMA]

Respected Sir,

doesn't it make a contract instead of hire, if we itself provide driver and reimburse fuel expenses ?

because in income tax TDS on such transaction is under 194C and not 194I because along with motor vehicles above mentioned supplies are also provided.

kindly provide clarity to our doubt

[KASTURI SETHI]

Then the classification will change. It will fall under the category of "Right to Use of Tangible Goods" and situation has to be examined afresh from every angle.

[NAGA DIVYA]

Hiring out vehicle to other GTA

Mine (Partnership Firm ) Business Activity is GAS AGENCY. I hired vehicle to (X) other than GTA along with Driver and other maintenance charges.

X Paying hiring charges on trip basis and deducting TDS U/S 194C.

How to raise invoice to 'X' and How to treat this service income under GST?

please clarity on this issue. Thanks in Advance.

AI Summary

Debate on GST exemption for vehicle hire services with driver and fuel under Notification No. 12/2017; tax implications discussed. A discussion on a forum addresses whether hiring out motor vehicles to a Goods Transport Agency (GTA) along with a driver and fuel expenses is exempt under GST Notification No. 12/2017. One participant confirms the exemption under certain conditions, citing the notification. Another raises concerns about whether providing a driver and fuel expenses changes the nature of the transaction to a contract, affecting tax deductions under income tax sections 194C versus 194I. A third participant queries how to invoice and treat service income under GST when hiring vehicles to a non-GTA entity, seeking further clarification.