The management and leadership services provided by the head office to its group companies / construction sites registered in different states would attract 18 percent of TPS, the AAR Maharashtra bench ruled.
BG Shirke Construction Technology Pvt Ltd had contacted the Advance Rulings Authority (AAR) to inquire whether the management and management services provided by the head office / head office to its group companies would be considered a ‘provision of service’. “.
In addition, if the lump sum billed by the head office / head office to the companies in its group would be liable to the goods and services tax (GST).
In rendering its decision, the Maharashtra AAR considered that the management and management services provided by the head office to its group companies and other construction sites registered in different states constitute a “provision of services” and would be taxable under the GST.
AMRG & Associates senior partner Rajat Mohan said the move would result in an additional 18% GST levy on B2B services in the form of management and leadership services whether or not the consideration was charged. .
“This decision would have a severe impact on companies operating through a network of multi-site companies, according to which a tax is payable on the management and management services provided by the head office to all companies in the group. Valuation and estimation Accurating these administrative and executive services on a monthly / quarterly basis could be a big problem for all large corporations, ”added Mohan.
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