TaxTMI 
TaxTMI 
leviability of service tax - Commission on Contract labour
08 Jan 2006 
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Service tax on gross amount charged may apply unless only commission is retained by the intermediary.
Leviability turns on whether tax is imposed on the gross amount charged or only on the commission retained; one view applies the statutory rule taxing the full invoiced amount, while an alternative position limits tax to the commission where the supplier merely channels wages to workers and documentary evidence establishes that the wage component is not retained. The service is classified as Manpower Recruitment or Supply Agency Services. (AI Summary)
Leviability turns on whether tax is imposed on the gross amount charged or only on the commission retained; one view applies the statutory rule taxing the full invoiced amount, while an alternative position limits tax to the commission where the supplier merely channels wages to workers and documentary evidence establishes that the wage component is not retained. The service is classified as Manpower Recruitment or Supply Agency Services. (AI Summary)
if i m providing contract labour to companies on a monthly charge of rs.5000/- & my commission is 10%i.e.500/- now whether service tax is chargeable on rs.500/- or 5500/-. if service tax charge on rs.5500/-than under which head, it is taxable.