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Registration Under Service Tax

Any person providing  taxable service(s) is required to file an application with the jurisdictional Central Excise Office for obtaining  within thirty days from the date on which the service tax on a particular  service comes into effect or within thirty days from the commencement of business . A ‘registered’ service provider is referred to as an ‘Assessee’.

Where a person is providing taxable service from  more than one premises or offices, and has centralized billing system or centralised accounting system in respect of such service, he may, at his option, obtain single centralised Registration .

Value Based Exemption                

A value based Service Tax exemption is avaible  where aggregate receipt of value towards taxable services does not exceed Rs. 10 lakhs in a Financial Year. This exemptions is available subject to certain  conditions as specified under Notification No. 6/2005 Dated 1-3-2005 and as amended from time to time.

Rate of Service Tax

The table below shows the  service tax rates from time to time .

Sr.No. Period Rate of Service Tax Rate of Education Cess Rate of Secondary & Higher Edu. Cess

1.

Till 13.05.2003

5%

Nil

-

2.

14.05.2003 to  9.09.2004

8%

Nil

-

3.

10.09.2004

10%

2% of the Tax.

-

4.

18.04.2006

12%

2% of the Tax

-

5.

12 .05. 2007

12%

2% of the Tax

1% of the Tax.

6.

24 .02. 2009

10%

2% of the Tax

1% of the Tax.

 
Deposit of Service Tax

In case of Individuals or Proprietary Concerns and Partnership Firm, service tax is to be paid on quarterly basis. The due date for payment of service tax is the 5th of the month immediately following the respective quarter. For the purpose,  quarters are : April to June, July to September, October to December and January to March. However,  payment for the last quarter i.e. January to March is required to be made by 31st of March itself.

Mandatory e-payment of Service Tax

The e-payment of service tax has been made mandatory w.e.f . 1.04.2010, for all assesses who have paid Service Tax of Rs 10 lakh or more in the preceding financial year or in the current financial year.

 
Interest & Penalty for Late Payment

In case of delayed payments ( after due date) the assessee is required to pay simple interest at the rate prescribed. Notification No. 26/2004 dated 10.09.2004 has specified the rate of interest at 13% per annum.

Penalty for failure to pay service tax : Not less than Rs.200 for every day during which failure continues, or @2% of such tax per month, whichever is higher but shall not exceed the amount   of service tax due.

Service Tax Return

Every assessee is required to submit a half yearly return in form S.T.3 along with copies of tax paid  challans. For the purpose of filing returns half year is counted from April to September and October to March. Date of filing of Returns : The half yearly return is required to be filed by the 25th of the month following a particular half year.

Late Filing of Return

Where the Service Tax return is furnished after the prescribed date, the person liable to furnish the said return shall pay late fee for the period of delay of ;

 

Period of Delay

Amount of Late fee is

Delay upto 15 days

Rs. 500/-

Delay beyond 15 days upto 30 days

Rs. 1000/-

Delay of more than 30 days

Rs. 1000/- plus Rs. 100 for ever day of delay.

Maximum late fee shall not exceed

Rs. 2000/-

 
Valuation 

Value of taxable services is gross amount received or charged from the client.  The valuation under service tax is governed by the provisions made under section 67 of the Finance Act, 1994  Value of taxable service shall be determined on the basis of one of the following:

  • consideration in money for providing the service.
  • consideration in money plus consideration in any other kind
  • consideration in any form other than money

Records

No separate statutory record has been prescribed  which are required to be by the assessee . The records as maintained by the assessee under any other law  in force, (including private record  maintained by assessee whether computerized or written manually)  are acceptable for the purpose of Service Tax .

Invoicing

Every person providing taxable service is required to issue (within 14 days of completion of service) an invoice, a bill  signed by him . Such invoice, bill or challan should be serially numbered and should contain following information :

  • Name, address and registration number of assessee.
  • Name and address of the person receiving services
  • Category of Service , Value of taxable service
  • Service tax & Cess payable thereon.
 
Assessment

Self assessment by Assessee : Every assessee is required to himself assess him self the tax due on the service provided by him and to furnish a returen to the Superintendent of Central Excise .

Provisional Assessment : Where an assessee is for any reason, enable to correctly estimate on the date of deposit , actual amount payable for any period he may make a request in writing to the Assistant Commissioner of Central Excise for provision assessment.

SERVICE TAX AUDIT            

Norms Regarding Selection Of Service Tax Cases For Audit  Are As Follows: -

 

S.NO

Payment of Duty 
(In Cash + through CENVAT Credit)

Frequency of Audit

1

More than Rs. 50 lacs

Every Year

2

Between Rs 50 Lacs to 25 Lacs

Once in 2 Years

3

Between Rs 25 Lacs to 10 Lacs

Once in 5 Years

4

Less than Rs 10 Lacs

2% of total nos. of such units to be audited every year.

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