Service tax on manpower supply for housekeeping services
Kirti Tulsyan
One of my clients is providing housekeeping services to a govt hospital. He deputes supervisors in the hospital to overlook the overall operations and the personnel are within the control of the agency and not the hospital. His invoice includes Salary paid to the personnel and supervisor + management charges.
In this respect, please let me know whether service tax will be charged as per supply or manpower or as a labour contract.
And also on what amount will the service tax be charged, is it on the total invoice value or only on management service. Under which will the service tax be chargeable? Will reverse charge apply in case the reciepient is a govt. hospital. Please guide.
Thanks & Regards
Sweta Agarwal
REPLY 1
Service should be manpower supply i.e. under command of Principal Employer.
“Supply of manpower” means supply of manpower, temporarily or otherwise, to another person to work under his superintendence or control.’ [Rule 2(g) of Service Tax Rules, inserted w.e.f. 1-7-2012].
Security service, cleaning service, piece basis or job basis contract can be ‘manpower supply service’ only if the labour work under superintendence or control of Principal Employer.
Service tax payable on salary plus PF, ESI plus commission of labour contractor.
Reverse charge applies if provider is an individual and recipient is a business entity registered as a body corporate. (25% by provider and 75% by recipient)
Regards
CA. Shivani Agarwall
Shivani Shah & Associates
Ph: +91 98304 02305, +91 33 2290 6390
Web: www.cassa.co.in
NEW REPLY 1
Dear Shivaniji,
In case a Sole Proprietorship (which is does have a service tax registration because its annual billing has not yet crossed the threshold) raises an invoice for “housekeeping services” on a pvt ltd company od say Rs 10,000 per month:
1 is the Pvt Ltd Company liable to pay 75% of the service tax chargeable on those services under reverse charge basis?
2 The sole proprietor is not paying any service tax since it is not registered. Hence, who bears the balance 25% liability?
3 Can the pvt ltd company claim input credit / refund on the service tax paid on reverse charge basis?
Best regards,
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NEW REPLY 2
Pls note that if services are falling within the ambit of manpower supply, reverse charge will apply. To determine the liability of recipient, it is immaterial whether the provider is liable to tax or not. Further credit can be taken by recipient subject to CENVAT Rules. Also while paying its liability, recipient needs to pay in cash and then claim credit.
Shivani
Kirti Tulsyan
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preeti
sanjay kumar dey
Dear all,
As the supervisor is under the control of the manpower supply agency. The services will be considered provided by manpower supply agency. Regarding the type of service it may be considered as man power supply service as primarily the service is supply of man power which is used for cleaning.
Regards
CA Sanjay Dey
On Mon, 07 Mar 2016 11:45:03 +0530 preeti wrote
>one of my client is providing cleaning services to private hospital. He deputes supervisors in the hospital to overlook the overall operations and the personnel are within the control of the agency and not the hospital. His invoice includes Salary paid to the personnel and supervisor + chemicals+management charges. so whether it is manpower supply or cleaning serivce?
On Wednesday, August 20, 2014 at 12:03:04 PM UTC+5:30, KIRTI TULSYAN wrote:One of my clients is providing housekeeping services to a govt hospital. He deputes supervisors in the hospital to overlook the overall operations and the personnel are within the control of the agency and not the hospital. His invoice includes Salary paid to the personnel and supervisor + management charges.
In this respect, please let me know whether service tax will be charged as per supply or manpower or as a labour contract.
And also on what amount will the service tax be charged, is it on the total invoice value or only on management service. Under which will the service tax be chargeable? Will reverse charge apply in case the reciepient is a govt. hospital. Please guide.
Thanks & Regards
Sweta Agarwal
REPLY 1
Service should be manpower supply i.e. under command of Principal Employer.
“Supply of manpower” means supply of manpower, temporarily or otherwise, to another person to work under his superintendence or control.’ [Rule 2(g) of Service Tax Rules, inserted w.e.f. 1-7-2012].
Security service, cleaning service, piece basis or job basis contract can be ‘manpower supply service’ only if the labour work under superintendence or control of Principal Employer.
Service tax payable on salary plus PF, ESI plus commission of labour contractor.
Reverse charge applies if provider is an individual and recipient is a business entity registered as a body corporate. (25% by provider and 75% by recipient)
Regards
CA. Shivani Agarwall
Shivani Shah & Associates
Ph: +91 98304 02305, +91 33 2290 6390
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