Motor Vehicle Designed

[MITSUI PRIME ADVANCED]

Dear Sir,

Our compnay hired a bus as per contract permit for transportation of employees , from near by residance to factory and back

it is cover under notification no 30/2012 dt 20.06.2012

any tax is atract

please provide your valuable suguation related for the same.

Rgards

Arjun Sachdeva

[Radha Arun]

Service tax is payable  on 40% of the amount charged. 

If the entity from which you have hired the bus is a individual, HUF or partnership, the service tax on 40% of the amount charged is payable by you to the government on reverse charge basis under notification no 30/2012.

If the entity is other than an individual, HUF or partnership, the service tax is payable by that entity and will be recovered from you on its bill.

AI Summary

Service tax on hiring of employee transport: taxable portion designated; reverse charge applies when provider is individual, HUF, or partnership. Service tax is levied on hiring a motor vehicle for employee transport by treating 40% of the amount charged as taxable; if the supplier is an individual, HUF, or partnership the recipient must pay under the reverse charge mechanism, whereas if the supplier is another type of person the supplier bears the service tax liability and can recover it from the recipient on its bill.