Dear Sir,
We are a manufacturing Unit , using manpower on contract basis ( production & other supportive work ) and take the GST Benefit also .,
Query:-
1 ) We are hiring 0.5% to 1% extra manpower to checking Input i.e. supplier Quality issues (recommend by supplier only ) @ our factory premises and the labour cost amount debited to supplier.,
Know my query is that whether we charged GST on such debit amount or not.
Regards
Manufacturing unit advised to reverse Input Tax Credit on labor costs; GST implications depend on contract terms. A manufacturing unit is inquiring about the applicability of GST on labor costs debited to a supplier for additional manpower hired to address quality issues at their factory. The responses suggest that the company should consider reversing the Input Tax Credit (ITC) on the deducted amount. It is noted that manpower supply is not under the Reverse Charge Mechanism (RCM), and the terms of the agreement with the contractor are crucial to determine the GST implications. If the agreement does not specify, it is suggested to charge GST on the recovered amount from the supplier. (AI Summary)
TaxTMI 
TaxTMI 
TaxTMI 
