Service Tax for Security Agency Contractors: Are You Meeting All Requirements?

Is service tax applicable to a contractor who provides labor under the form of a security agency? Also, are all the statutory requirements and payroll of the laborers maintained by the contractor?

Sir, I am a labor contractor. I have provided more than 35 laborers to an electrical company. All these laborers are under my employment, and I manage all their statutory requirements, including ESI, PF, and Payroll. These workers are sent to the electrical factory to work as laborers provided by me. They are not employees of the electrical company. Does this type of work attract service tax? If so, under which category?

Hi, I am the director of a security agency. Service tax is indeed applicable to the services provided to any company, including labor services. Initially (up until approximately 3 years ago), labor was exempted.

Service Tax is linked to the turnover of the company. If the annual turnover of the contracting company exceeds Rs. 10.00 lakhs, then the subject company would come under the ambit of Service Tax, and service tax would become payable. The quantum of service tax payable could be charged to the principal employer, who in turn would be in a position to claim/avail input credit.

Regards

Dear friend,

If your 100% EOU unit is located in a notified SEZ, then you will get an exemption under Service Tax.

Hi,

If one opens a new security company and applies for and obtains their service tax number, is it mandatory for them to charge service tax even if their turnover is zero or falls below 10 lakhs?

Kindly advise, seniors.

Thanks

Service Tax @ 10%, including Education Cess @ 2% on S.T and Higher Education Cess @ 1% on S.T.is applicable to you on the total bill which incldes salaries and other allowances paid to your employees. This is under the category of Security Agencies vide S.No. 108 of the notification which will be available to you on the back side of the Challan itself. You are having the option to pay Service Tax every month or once in three months. You have also to submit ST-3 Return for every Six months at the end of Mar and Sept. Good luck

Service Tax is not applicable for a security company with an annual turnover of less than 10 lakhs. If the turnover exceeds 10 lakhs, then it is mandatory to pay the Service Tax on the complete bill. No gestation period is applied under Service Tax rules. The moment the company starts and exceeds the turnover of Rs. 10 lakhs, invariably Service Tax is payable. Good Luck