GTA means Goods Transport agency, Service Tax are exempted fully from levy of service tax on supply of transport vehicles (goods carriage) to a goods transport agency (GTA) to be used for transport of goods by road,
Services provided by a GTA in relation to transportation of goods is leviable to service tax under GTA service, Service tax for the GTA service provided is payable only on 25% of the amount charged for providing the GTA service and the balance amount is exempt from levy of service tax.
In view of this provision, GTAs are not entitled to take input credit under Cenvat Credit Scheme on goods and services used for GTA service. Moreover service tax for GTA services provided in seven specified cases is not required to be paid by the GTA service provider but by the person making payment towards the freight.
Scenario to be considered in case of GTA,
a)Tax payed to vendor & b) Tax payed to government
You can modify your TAX Procedure to accommodate GTA conditions,
It is same as TDS process which we deduct while paying to vendors,
Refer follwoing SAP Notes for better understanding
SAPNote 1242881 - Service tax posting in invoices from Goods transport agency
SAPNote 1244301 - Service Tax - Goods Transportation Agency
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