Struggling with Service Tax and ESI/PF for Manpower Supply in Chennai? Need Guidance!

Procedure for Paying Service Tax

I am in the business of manpower supply, operating for the last year in Chennai with a leading foundry company. I have not yet taken ESI and PF. I applied for it a long time back but was unable to obtain it. Now, the company requires my paid service tax channels to release the payments. Kindly help me out.

1. I need to know the procedure and authorities with whom I have to apply for ESI and PF.
2. Where and how should I pay the service tax, and at what rate and amount? Kindly answer.

Thanks in advance.

I think the service tax exemption limit is ₹10 lakh. If the turnover exceeds ₹10 lakh, service tax will apply. The applicable percentage of service tax in FY 2012-13 is 12.36%, including surcharge and cess.

Regards, Pon

Referring to your query on the above subject, as a contractor, you have to comply with and fulfill statutory requirements under labor enactments. For Service Tax, if your turnover exceeds more than 10 lakhs, you will pay service tax at 12.36%, including surcharge and cess for every month, and remit the same online to the tax authorities. You can approach the Central Excise Department of your concerned area for registration and guidance.

For PF and ESI, if your organization has more than 10 members on any day in the preceding twelve months, you will need to comply with the ESI and PF Acts. Please contact the authorities for registration and guidance.

Regards,
P.V. Rama Rao
[Phone Number Removed For Privacy Reasons].

Yes, the service tax exemption limit is ₹10 lakh. If the turnover exceeds ₹10 lakh, service tax will apply. The applicable percentage of service tax in FY 2012-13 is 12.36%, including surcharge and cess.

Service Tax Registration and Payment Process

Service tax is payable after a turnover of ₹10 lakhs, but registration is needed when you cross ₹9 lakhs. I hope you have not been charging service tax to your clients without paying it to the government because that could lead to significant trouble.

If you need to pay service tax, you must apply for a number with the local service tax office. They will generally provide you with the service tax number within one week. They don't charge anything, officially or unofficially.

Once you receive the number, you need to pay the tax amount, generally online through your bank. Additionally, you must file returns twice a year, in October and April.

But has your client asked for a service tax challan or PF ESIC challan?

Regards

Yes, the service tax exemption limit is 10 lakhs. Above 10 lakhs, the applicable service tax will be 12%, educational cess 2%, and S.H.E. cess 1% with effect from the financial year 2012-13.

Thank you for your attention to this information.

In the case of the labor supply contract, is service tax payable on the total bill, or is it excluding the wages paid by the laborers? I would like to know whether the service tax applies in this scenario.

Well, service tax is applicable only if your turnover is more than ₹10 lakhs. If not, then there is no need to worry. If yes, then you have to pay service tax at 10% + 2% + 1% = 10.3% for the year 2011-2012.

In the case of a labor supply contract, is the service tax payable on the total bill or excluding the wages paid by the contractor to his laborers? I would like to know whether the service tax is applicable on the total bill. It is not applicable on EPF & ESI amounts, but you have to show both amounts in your invoice/bill. If your client is ready to pay you service tax on the total bill, then there is no need to mention that.

Thanks.

Regards.

Service Tax Code for Labor Contractors

What is the Service Tax Code, and if I am a labor contractor, under what Service Tax Code do I get myself registered? I supply labor for welding contracts.

Regards,
Ram Prasad

Service Tax code is necessary if your services fall under the taxable services list and your yearly turnover crosses 10 lakhs. (Providing manpower for welding is a taxable service.) You can apply for registration at the nearby Central Excise & ST Office for a new service tax code; they will guide you better.