GTA - service tax pmt

[venkat eswaran]

Sir / Madam,

we are paying service tax for frt inward & outward GTA- on behalf of transporter. that is Service receiver liable to pay service tax. under the new service tax rules service tax to be paid even when the bill raised by the service provider (General) instead of pmt received date.  Whether this is applicable to GTA also? my question is whether we have to pay service tax on receipt or date of credting the bill basis OR we can pay  service tax after we make the pmt to the transporter? Pl help me on this.

G Venkateswaran

 

[YAGAY and SUN]

Rule 2A inserted in the POTR 2011 to define the date of payment as the earlier of the dates on which the payment is

––entered in the books of accounts or

––credited to the bank account of the person liable to pay tax except in certain specified cases

In case of services where the receipient is obliged to pay service tax under rule 2(1)(d) of service tax rule, ie on reverse charge basis, the point of taxation shall be the date of making the payment. However if the payment is not made within six months of the date of invoice, the point of taxation shall be the date of invoice. In case of associated enterprises, when the service provider is outside India, the point of taxation will be the earlier of the date of credit in the books of account of the service receiver or the date of making the payment.

AI Summary

Point of taxation: reverse-charge services taxed on date of payment, with invoice-date fallback if payment delayed, and earlier-of-book-entry-or-bank-credit rule.
For reverse-charge services, the point of taxation is the date of payment by the recipient; Rule 2A treats date of payment as the earlier of entry in books or credit to bank (subject to exceptions). If payment is not made within the prescribed six month period from invoice, the point of taxation is the invoice date. For associated enterprise services from outside India, the point of taxation is the earlier of book credit or payment.