No. TDS is deductible net of GST i.e. taxable amount.
Service tax on TDS Reimbursement
Dear Sir/Mam, I am into the business of Manpower Recruitment where I raise bill to the client and collect the amount as salary reimbursement. My want to know is Service tax applicable on TDS reimbursement which I have collected from the client. The client has also deducted the same tds which is reflecting in my Form 26 AS. Regards, Divyesh Jain
Asked 5 years ago in Service Tax
But what about Service Tax applicability on TDS Reimbursed amount. Should Service Tax have been collected on this TDS reimbursed amount, if this tds amount is added and deducted in the bill. If you can provide some judgement of high court or any section under which it can be proved it would be helpful.
Asked 5 years ago
Service tax is also out of TDS deduction. CBDT issued a circular as below.
https://www.charteredclub.com/wp-content/uploads/2014/05/tds-on-service-tax-cbdt-circular.pdf
Hi Divyesh
As I understand from your query, you raise the bill of entire consideration out of which the client makes the payment after deducting TDS.
GST shall be applicable on the entire consideration and not only on amount received by you after TDS deduction.
Say,
Gross amount = 100
TDS = 10
GST shall be charged on 100 and not on just 90.
Hello,
If the amount of GST is mentioned separately in the invoice, then TDS deduction is to be made only the taxable value only and not on the GST amount.
I hope that this answer satisfies your requirements.
Regards,
CA Hunny Badlani
GST/Service Tax isn't applicable on the TDS Amount.
I will give you an example how I prepare the bill Salary amount---100 PF amount - - - - - -40 ESIC amount------- 20 GST on above-------29 Total------------------189 Add : TDS @ 2% on 189 = 4 Less : TDS @ 2 % on 193 = 4 Total bill amount = 189 I dont charge GST on the TDS reimbursed component and I am also getting the TDS credit in my 26as from the party. Is it correct as per GST or Service tax act?
Asked 5 years ago
Why TDS is being added once and reduced then?
I would suggest you to take a phone consultation for clarity and better understanding.
Service tax is applicable on the service you are providing. Therefore it shall be charged on your gross amount before TDS.
If there is a reimbursement of TDS then it's just a accounting adjustment and cannot be chargeable to service tax or GST.
Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.
Thank you
I don't get it why have you added tds and then reduced it.
It would be better if we have a phone consultation.
Things would be more clear
Dear Sir,
Hope you are doing well !!
GST should be charged on entire consideration not only on net consideration.
I don't get it your example.
However, you don't need to charge GST on reimbursement of TDS.
It is advisable to take a phone consultation for detailed discussion.
I didn't understand why TDS is first added and then deducted.
There is no GST on the TDS portion.
advisable o take a phone consultation
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