Sunday, September 9, 2012

SERVICE TAX EXEMPTION LIMIT TEN LAKH WHO CAN AVAIL WHO CAN'T AVAIL


on Sunday, September 9, 2012

Service Tax act/Rules has provided exemption to small scale service provider from service tax up to aggregate value of taxable services provided of 10 lakh in a Financial Year . This exemption was available before 01.07.2012 and continued even after 01.07.2012 in negative list regime with few changes wef 01.04.2012.

If in the previous financial year the aggregate value of taxable services provided by you was less than Rs.10 lakh and in the present financial year the aggregate value of taxable services provided by you is also less than Rs.10 lakh. Then no need to pay service tax .

If in the previous financial year aggregate value of taxable services provided was less than 10 lakh but this year aggregate value of taxable services provided is more than 10 lakh them you start paying service tax after crossing the threshold of Rs 10 lakh.

If in the previous financial year aggregate value of taxable services provided was more than 10 lakh but this year aggregate value of taxable services provided is less than 10 lakh them you start paying service tax from rupee one.


See chart

Aggregate value of Taxable Services provided
Service Tax applicable
Preceding Financial  Year
Current Financial year
Less than 10 lakh
Less than 10 lakh
No service tax
Less than 10 lakh
More than 10 lakh
Service tax applicable after 10 lakh
More than 10 lakh
Less than 10 lakh
service tax applicable from Rs one ,No exemption available


The Finance Act 2012, has amended the provision relating to small scale exemption recognizing that the aggregate value up to Rs 10 Lakhs will be in terms of invoices issued/to be issued for taxable services and not payments received.(Notification no.33/2012-ST dated 20.6.2012). This is w .e .f 1.7.2012. 

1.Meaning of aggregate value :The small service provider exemption of ` 10 Lakh is available towards “aggregate value not exceeding ` 10 Lakhs”, means the sum total of value of taxable services charged in the first consecutive invoices issued during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66B of the said Finance Act under any other notification.

The definition of the ‘aggregate value’ has been amended w.e.f. 01.04.2012 whereby the sum total of the value of taxable services charged in the first consecutive invoices issued/required to be issued during the financial year shall be considered instead of payments received.

The exemption as to small service provider is provided for the keeping the small service provider outside the tax net.

2Single Limit for all services By same person : where a taxable service provider provides one or more taxable services , the exemption under this notification shall apply to the aggregate value of all such taxable services and not separately for each  services; 

Suppose A person is providing service XXX and YYY . To avail this exemption aggregate service provided for service XXX and YYY should be less than 10 Lakh

the aggregate value of taxable services rendered by a provider of taxable service from one or more premises, does not exceed ten lakh rupees in the preceding financial year. 

3. Single Limit for all offices /Location : where a taxable service provider provides taxable services from one or more premises, the exemption under this notification shall apply to the aggregate value of all such taxable services and from all such premises and not separately for each premises; 

Example:In service Tax person can get separate registration for deferential location .To calculate 10 lakh Limit ,Aggregate value of taxable services at all location ,even having different registration number , is to be considered.

In brief this exemption is available person wise not location or service wise.

4.Cenvat Credit not available if Exemption of 10 lakh  has been availed. 

5. Exemption is optional not mandatory : This exemption  is optional so that even such small service providers can opt to pay tax instead of availing the benefit of exemption. In case of such opting to pay service tax, the service provider would get the benefit of CENVAT Credit of duties and taxes paid on capital goods, inputs and input services. By this mechanism the CENVAT credit can get passed on whereby the basic cost of output service would get reduced if the service receiver can avail CENVAT credit.  

6.Once exercised Can not be reversed : The option as to non-availment of such small scale exemption and opting to pay tax once exercised, cannot be withdrawn during the remaining part of such financial year. 

Option is granted to service provider to avail benefit of threshold exemption to the tune of ` 10/- lakhs. In case option is exercised by service provider, service tax would be applicable only if the aggregate value of taxable service ( provided during the previous financial year exceed ` 10 Lakhs )

7.No exemption where service tax is payable under Reverse Charge: However the above exemption shall not be available to the person made liable to pay service tax under sec (68)(2) [Reverse Charge and Joint Charge liabilities]  


The liability of the service provider and service recipient are different and independent of each other. Thus in case the service provider is availing exemption owing to turnover being less than Rs 10 lakhs, he shall not be obliged to pay any tax. However, the service recipient shall have to pay service tax which he is obliged to pay under the partial reverse charge mechanism.

8. No Exemption If Service are provided under brand name or trade name of others :The person providing service under the brand name or trade name of others. Some persons are providing the services under name of brand name owner. These service providers would not be eligible to the exemption which is available to the small service providers.

If service provided under own brand name or trade name then eligible : If a person is providing a service under his own brand name, he would be entitled to the exemption.

9. The Basic Exemption subject to above condition is available to all type of Person :The basic exemption is not restricted only to individual or partnership firm but it is available to all assessees.

‘Person’ is not restricted to natural person. ‘Person’ has been defined Section 65 B of the Act.  The following shall be considered as persons for the purposes of the Act:
  1. an individual
  2. a Hindu undivided family
  3. a company
  4. a  society
  5. a  limited liability partnership
  6. a firm
  7. an association or body of individuals, whether incorporated or not
  8. Government
  9. a  local authority,  or
  10. every artificial juridical person, not falling within any of the preceding sub-clauses.
10. Abatement and exempted services is not to be counted for calculation of 10 Lakh: 

Please note that there are different views on this subject ,please read comments given by Manoj aggarwal in comment section also.

 Various services has been exempted from service tax vide notification 25/2012 .If service provider is providing both exempted and taxable services than turnover of exempted services is not be added for calculation of 10 lakh .
Similarly abatement from gross amount charged by service provider  has been defined in notification 26/2012  .To calculate 10 lakh part only taxable part after abatement is to be considered.

Example: Person is providing services of renting motor vehicle designed to carry passengers. In a given financial year he has charged gross Rs 20 lakh for services . In notification 26/2012 only 40% part i.e 8 Lakh is taxable for renting of motor vehicle designed to carry passengers  (40% of 20 Lakh) . So he can can avail 10 lakh exemption available to small service provider ,as taxable part of services provided by him is less than 10 lakh Limit.
Please note that there are different views on this subject ,please read comments given by Manoj aggarwal in comment section also.


Relevant notification is given here under 
Notification No. 33/2012 - Service Tax New Delhi, the 20th June, 2012
 G.S.R. (E).-  In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the said Finance Act),  and in supersession of the Government of India in the Ministry of Finance (Department of Revenue) notification No. 6/2005-Service Tax, dated the 1st March, 2005,  published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide G.S.R. number 140(E), dated the 1st March, 2005, except as respects things done or omitted to be done before such supersession, the Central Government, being satisfied that
it is necessary in the public interest so to do,  hereby exempts taxable services of aggregate value not exceeding ten lakh rupees in any financial year from the whole of the service tax leviable thereon under section 66B of the said Finance Act:
Provided that nothing contained in this notification shall apply to,-
(i) taxable services provided by a person under a brand name or trade name, whether registered or not, of another person; or
(ii) such value of taxable services in respect of which service tax shall be paid by such person and in such manner as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules,1994. 
2. The exemption contained in this notification shall apply subject to the following conditions, namely:-
(i) the provider of taxable service has the option not to avail the exemption contained in this notification and pay service tax on the taxable services provided by him and such option, once exercised in a financial year, shall not be withdrawn during the remaining part of such financial year;
(ii) the provider of taxable service shall not avail the CENVAT credit of service tax paid on any input services, under rule 3 or rule 13 of the CENVAT Credit Rules, 2004 (herein after referred to as the said rules), used for providing the said taxable service, for which exemption from payment of service tax under this notification is availed of; 
(iii)the provider of taxable service shall not avail the CENVAT credit under rule 3 of the said rules, on capital goods received, during the period in which the service provider avails exemption from payment of service tax under this notification;
(iv) the provider of taxable service shall avail the CENVAT credit only on such inputs or input services received, on or after the date on which the service provider starts paying service tax, and used for the provision of  taxable services for which service tax is payable;
(v) the provider of taxable service who starts availing exemption under this notification shall be required to pay an amount equivalent to the CENVAT credit taken by him, if any, in respect of such inputs lying in stock or in process on the date on which the provider of taxable service starts availing exemption under this notification;
(vi) the balance of CENVAT credit lying unutilised in the account of the taxable service provider after deducting the amount referred to in sub-paragraph (v), if any, shall not be utilised in terms of provision under sub-rule (4) of rule 3 of the said rules and shall lapse on the day such service provider starts availing the exemption under this notification;   
(vii) where a taxable service provider provides one or more taxable services from one or more premises, the exemption under this notification shall apply to the aggregate value of all such taxable services and from all such premises and not separately for each premises or each services; and
(viii) the aggregate value of taxable services rendered by a provider of taxable service from one or more premises, does not exceed ten lakh rupees in the preceding financial year. 
3. For the purposes of determining aggregate value not exceeding ten lakh rupees, to avail exemption under this notification, in relation to taxable service provided by a goods transport agency, the payment received towards the gross amount charged by such goods transport agency under section 67 of the said Finance Act for which the person liable for  paying service tax is as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules, 1994, shall not be taken into account. 
Explanation.- For the purposes of this notification,- 
(A) “brand name” or “trade name” means a brand name or a trade name, whether registered or not, that is to say, a name or a mark, such as symbol, monogram, logo, label, signature, or invented word or writing which is used in relation to such specified services for the purpose of indicating, or so as to indicate a connection in the course of trade between such specified services and some person using such name or mark with or without any indication of the identity of that person;
(B) “aggregate value” means the sum total of value of taxable services charged in the first consecutive invoices issued during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66B of the said Finance Act under any other notification.”
4. This notification shall come into force on the 1st day of July, 2012.
[F.No. 334 /01/2012- TRU] (Raj Kumar Digvijay)Under Secretary to the Government of India

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  1. Very good coverage. Thanks. I have a question. Last two lines of Para 8 of the lead article say "If a person is providing a service under his own brand name,he would be entitled to the exemption". I am an Actor in films and TV Serials. I receive payments in my name by crossed a/c payee cheques,and sometimes by cash on a voucher signed by me.The title card of film/TV Serial shows my name. Am I exempted from paying Service Tax?

    ReplyDelete
    Replies
    1. Yes, yes . no doubt in that . You are providing services to the producer and there is no question of brand name arises in services provided in individual capacity.

      So you can definitely claim exemption limit.

      Delete
  2. Dear sir,

    now service provider is also covered in sec. 68 (2), than those service provider who are covered in in partial reverse charge also have to pay tax from Rs. 1 ? ( no exemption can availed)

    please clear the matter, Thanks in advance.

    ReplyDelete
    Replies
    1. Under section 68(2) service receiver are liable to pay tax not service provider.

      so If persons are liable to pay tax due to reverse charge ,then they(service receiver) can not claim exemption of Rs 10 Lakh, even service provider has a turnover of less than 10 Lakh .

      read point no 7 above.

      Delete
    2. Under section 68(2) service receiver are liable to pay tax not service provider.

      so If persons are liable to pay tax due to reverse charge ,then they(service receiver) can not claim exemption of Rs 10 Lakh, even service provider has a turnover of less than 10 Lakh .

      read point no 7 above.

      Delete
  3. Some times basic doubts arises. you have clarified this. Thanks a lot.

    ReplyDelete
  4. Thanks a lot!
    I have a doubt:

    Amount of bill raised for taxable services during the following financial years:

    2008-09: Rs. 8,00,000/-
    2009-10: Rs. 11,00,000/-
    2010-11: Rs. 9,00,000/-
    2011-12: Rs. 12,00,000/-

    I am sure that exemption is available to F.Y. 2008-09 & 2009-10 but doubt is that "whether exemption is available for F.Y. 2011-12".

    ReplyDelete
    Replies
    1. In our view person can avail exemption in 2011-12 also .But he has to opt for this scheme . The notification has given an option not to avail the benefit of the above notification.But the Notification is silent on how the option will be exercised. In absence of any specific procedure, it would be desirable to make a declaration by way of an application on plain paper mentioning the intention to avail for the exemption scheme.

      Delete
    2. Dear Raja Babu,

      The exemption is available automatically and no need to exercise any option. Yes, if a service provider want's not to avail this exemption, then he has to exercise his option for non-availment, which may be done by a self declaration.

      Delete
  5. I, in the role of freelancer software developer, receive a payment of more than Rs. 10.0L through Paypal from outside India. Do I need to go for Service Tax registration.

    S K Agrawal
    saroj123@gmail.com

    ReplyDelete
    Replies
    1. I will be thankful if you spare some time to answer this question.
      S K Agrawal
      saroj123@gmail.com

      Delete
    2. yes.you have to go.
      because it is taxable service.

      Delete
  6. As per above Chart in third row Service Tax applicable from Rs one,
    No. exemption available that means-

    Preceding Financial Year- After Rs. 10 lakh

    Current Financial year- From beginning

    ReplyDelete
    Replies
    1. Status of current year is shown in third column.Yes ,in current year tax will be applicable from beginning if proceeding year turnover is more than 10 lakh.


      To check the status of preceding financial year service tax applicability you have to go back one more year back.only then you can decided ,from which amount service tax applicable.

      Delete
  7. hi this is triyambak. i have a doubt in paragraph 6 it is saying that unutilised balance in CENVAT CREDIT after deducting the amount referred to in sub-paragraph (v), if any, shall not be utilised in terms of provision under sub-rule (4) of rule 3 of the said rules and shall lapse on the day such service provider starts availing the exemption under this notification; i do not understand the value of point v in point vi .

    ReplyDelete
  8. I recently got sales tax no., while deal in stuff which is liable for service tax. Now I am in a fix, since there is an exemption on service tax, while I have a sales tax no. I have to submit a proposal to a govt. Institution, what shall I do.
    Can I submit this proposal through some other name. Also, govt. Institutions might ask for a registration no., or is it not necessary, due to exemption policy?
    Can I submit this proposal through my TIN No. , this work is a website related stuff.
    any reply would be of great help. Thanks

    ReplyDelete
  9. enlightment!!!!! thanks you !!! :)

    ReplyDelete
  10. I am completely confused after talking to the Service Tax Superintendent. I started software consulting in Feb this year and earn about 2lakh per month. So from exemptions perspective my understanding is that I will be exempted for Feb and March as it is below 10lakhs. Even in this financial year I will be exempted from ST from April to Aug and start paying from Sep when it crosses 10L. But the officer says that there is no concept of financial year and I will get only one exemption of 10lakh starting from Feb to now. Please throw some light on this.

    ReplyDelete
  11. DEAR RAJA BABU,

    One person has provided service of commercial construction with materials on the basis of tender for the amount of Rs.5.2 Lac in the financial year 2006-07 in which threshold limit for ssp notification No. 06/2005 was Rs. 4 Lac. Materials of Rs. 3.2 Lac was used in the said services, we apply Notification no. 12/2003 & also issuing CA certificate evidencing the materials used. It means he provided actually service of Rs. 2 Lac.

    Query is whether Service provider is eligible for taking benefit of Notification No.06/2005 not required to pay service tax in the year 2006-07 as his service portion does not exceed Rs. 4 Lac? Or he is required to pay service tax on balance amount or Rs 1.2 Lac ( Gross Amount Received Rs.5.2 Less Threshold limit for SSP)?

    ReplyDelete
    Replies
    1. Service Tax not chargeable in such case.To check SSP limit only service portion is required to be considered not whole value of composite works contract.

      as in given case value of service provided is less than ssp limit ,tax is not applicable.

      Delete
    2. Dear RAJA BABU,

      Are there any Decisions or any Circular over & above section 67 & Notification 12/2003 for making the case stronger as this being a case of TENDER of composite contract its difficult to give justification to the Department without any decision?

      Delete
  12. Dear RAJA BABU,


    with reference to query of PRADEEP MULANI21 December 2012 3:18 PM

    Are there any Decisions or any Circular over & above section 67 & Notification 12/2003 for making the case stronger as this being a case of TENDER of composite contract its difficult to give justification to the Department without any decision?

    ReplyDelete
    Replies
    1. In our view ,it is very much clear that material value can not be added for service tax purpose .so CASe laws are not required .Further pls read master 97/04.01.2008 circular,it clerly says that

      Value for the purposes of levy of service
      tax under works contract service does
      not include the value pertaining to
      transfer of property in goods involved in
      the execution of a works contract leviable
      to VAT/ sales tax."

      Though the context is for cenvat but it is applicable on valuation also.

      Delete
  13. Hello,
    A small query on service tax. I believe payment of service tax to the government comes into effect only after 10 Lakh Rs. limit is crossed.

    Let's say a small shop owner charges service tax to the customers. But in the financial year, the limit for service tax is not reached i.e. remains below 10 Lakhs (say at 8.5 lakhs).

    What should the shop owner do with the amount he has collected in advance as service tax from customers?
    Should it still be paid to the tax authorities, or carried forward to next year, or can be utilized by the shop owner?

    Thanks

    ReplyDelete
    Replies
    1. if he has collected the amount then he has to deposit the same to department ,if he wants to claim exemption he should not collect tax from customers also.

      Delete
  14. Dear Rajababu

    If one person having three partnership with Three different person and having three different premises then how we calculate this 10 lakhs turnover limit for three different partnership'

    ReplyDelete
    Replies
    1. 10 lakh exemption is available to all the three partnership firms separately

      Delete
    2. What if office address for all three partnerships are also same???

      Delete
  15. Is Bank Guarantee is must along with the other documents submitting for Freight Tax Exemption in India??

    ReplyDelete
  16. Sir
    I am a civil contractor engaged in works contract business. Last year my gross turnover was 11 lakhs.The service tax officials insist that I had crossed my basic exemption limit of 10 lakhs and that I need to pay service tax from Rupee one in the current financial year.
    Kindly clarify whether the basic exemption limit of 10 lakhs is for the gross turnover of works contract or only for the service component.
    Regards

    ReplyDelete
    Replies
    1. only service part is to be considered for exemption purpose ,you ask them under what under what rules gross turnover is to be considered

      Delete
  17. Dear Sir,
    At para 10, you have suggested that Abatement and exempted services is not to be counted for calculation of 10 Lakh.

    This is correct with respect to exempted services. But in my view, abatement available under not. no. 26/2012 is a part of aggregate value since it is not wholly exempt.
    Explanation(B) “aggregate value” means the sum total of value of taxable services charged in the first consecutive invoices issued during a financial year but does not include value charged in invoices issued towards SUCH services which are exempt from WHOLE of service tax leviable thereon under section 66B of the said Finance Act under any other notification.”
    In case of abatement, WHOLE service is not exempted.
    Sir, Please correct me.
    Regards,
    Manoj Agarwal (tax2001-it@yahoo.com)

    ReplyDelete
    Replies
    1. Explanation(B) “aggregate value” means the sum total of value of "taxable services charged"

      in above word is taken as taxable service charged but through abatement, value of taxable service is reduced

      Delete
    2. Explanation(B) “aggregate value” means the sum total of value of "taxable services charged in the first consecutive invoices"

      So, in an Invoice claiming abatement, the value is charged in full and only tax is reduced, not the value. Value in full with abated tax is paid by the receiver of service to service provider.

      Also, Otherwise going by the same analogy, there was no need to specifically mention "but does not include value charged in invoices issued towards SUCH services which are exempt from WHOLE of service tax leviable thereon under section 66B of the said Finance Act under any other notification."

      Delete
    3. Suppose a builder provided a complex to customers.For which he has charged 11 lakhs from them (including land) and availed abatement under notification 26/2012 for 75 % .Assume that this is his first year of operation and only sale in the year . what should be the service tax he should charge from the consumer.

      Delete
  18. Sir, as per my understanding, 'aggregate value' does not include value charged in invoices issued towards 'SUCH SERVICES' which are 'EXEMPT' from 'WHOLE OF SERVICE TAX' leviable thereon.

    In Abatement notification no. 26/2012, the notified 'SERVICES' are 'PARTIALLY EXEMPT' from tax, instead of 'WHOLLY EXEMPTED' as in notification no. 25/2012.

    Having reiterated this, the builder should issue Invoice for Rs. 11 Lacs. 1st 10 Lacs is fully exempted vide Not. No. 33/2012. So, tax is chargeable on balance Rs. 1 Lac and after availing abatement of Rs. 75,000/- tax is charged @12.36% on Rs. 25,000/- which comes to Rs. 3,090/-

    ReplyDelete
    Replies
    1. In our view if Land value is more than 1 lakh then person should not avail abatement at all and as the balance amount will be less than exemption limit of 10 lakh so Nil Tax is payable after exemption.

      Further if we go by your views also that abatement is not to be considered for exemption limit then the calculation should be as under.

      Gross value charged to customer =1100000
      less :abatement 75 % =825000
      Balance taxable part =1100000-825000=275000(A)

      Gross value charged to customer =1100000
      less :exemption =1000000
      Balance taxable part =100000(B)

      service tax on (A)or (B) which ever is less.
      12.36% on 100000=12360 Rs

      This is due to the fact that it is not mentioned in abatement that this is to be allowed after exemption limit

      Delete
    2. Is Example A, the benefit of exemption of 10 Lacs is not availed.

      In Example B, the benefit of abatement of 75% has not been availed.

      Both the notifications 26 & 33 are independent of each other and are beneficial for the assessee.

      So, even if it is not mentioned in abatement that this is to be allowed after exemption limit, the exemption limit must be allowed as it is a special benefit given to the small service providers.
      In your example, suppose the builder issues 2 invoices, 1st for Rs. 10 Lacs and 2nd for Rs. 1 Lac. Then what will be the service tax according to you?

      Delete
  19. Sir
    My aggregate gross turnover for works contract in the previous year is Rs 12 lakhs. We have Not shown the material portion and the service portion separately in our Bills. Does it mean that we have crossed the threshold exemption limit of 10 lakhs and if so what would be our tax liabilty?

    ReplyDelete
  20. Dear Raja Babu

    Kindly answer the above query please.

    Regards

    ReplyDelete
    Replies
    1. In our view service tax can not be imposed on material part , so you can avail benefit of material part and net amount can be offered for service tax .In your case net amount will be less than 10 lakh so you are eligible to get exemption.

      Further you may issue addition details as annexure to the bill to the party and save them in your records for future requirement

      Delete
    2. Dear Raja Babu
      The gross value of 12 lakhs has been arrived as an aggregate of 15 different Works Contract bills issued during the year.

      How can we issue addition details as annexure to each of the bills seperately?
      Regards.

      Delete
  21. what we have to do if output in less then cenvat?

    ReplyDelete
  22. Hello Sir,

    what if the salary and other expenses exceeds the overall turn over.

    say for example: i have totally 15 employees salary and other expenses which costs me 12 lakhs and my yearly turn over is 11 lakhs..so i need to pay service tax??

    i cant ask my service receivers to pay, as they are foreign clients...

    greatly appreciate your reply.
    Thanks,

    ReplyDelete
    Replies
    1. Being a a foreign client, a service recipient, analyse in the light of place of provision of service rules read with Rule 6A of Service tax Rules, if the same qualifies for export. If so, there is no requirement to make payment of Service tax.

      Trust your query is answered.

      regards,
      CA Jigar

      Delete
  23. Sir, I have a manpower recruitment consultancy, and its income was below 9lacs, still my CA asked me to pay ST,every quater. It was not at all needed. If income do not exceed 9lac limit,Do I need to pay ST for nxt financial yr(13-14) also?

    ReplyDelete
  24. Sir

    My name is Clement I have been doing small rental real estate transactions over the past few years i have being made to submit bills that include service tax , my annual income totally come to 3 lakhs , 4.5 laksh and this year till date is Rs. 5 lakh ,i have to usually share my earning with my associates after doing so i end us earning around 2 lakhs or less till now , i found this article and really want your help should i pay service tax or am i exempted ,


    Waiting to hear your advice .

    ReplyDelete
    Replies
    1. service tax is not on income but on sale/turnover price. However in your case as turnover is less than 10 lakh ,so you can avail basic exemption of 10 lakh.

      Delete
  25. This exemption is allowed after voluntary registration ?
    I mean the exemption is allowed even provider is registered under service tax if they are not charging service tax from customers ?
    Pls clarify asap.

    ReplyDelete
    Replies
    1. yes, you can avail exemption even after registration .but you have to file return if you are a registered dealer

      Delete
  26. if in the first year of business, service provider crosses the threshold limit of Rs. 10 Lakh, what will be the implication ?
    Whether service tax has to be paid on entire amount or amount of service in excess of Rs. 10 Lakh.

    ReplyDelete
    Replies
    1. only on services provided in excess of 10 lakh

      Delete
  27. Sir, I'm a authorised two wheeler dealer of a branded manufacturer. I've been doing sales and service since 5 years. Assuming I get the basic exemption limit for the small scale service provider, I've not registered under ST. But the department has asked me to pay the tax from 1st invoice.
    Though I use the brand name of the manufacturer, I've my own registered firm through which we raise the invoice. Could you please clarify what does using brand name exactly mean. I mean will a franchisee using the brand name and I, authorised dealer using the manufacturer's brand name are one and same.

    ReplyDelete
    Replies
    1. in our view general exemption is available to you .same is shown on govt website

      http://www.servicetax.gov.in/st-profiles/service-stns-motors.htm

      Delete
  28. The value of services provided for a client is Rs. 7 lakhs. Additionally, the individual provides services which are liable in the hands of the services recepient (i.e. under reverse charge). The value of these services is approx. Rs. 4 lakhs. Is the service provider required to obtain registration considering that the aggregate value of services provided by the service provider is Rs. 11 Lakhs?

    Please comment

    ReplyDelete
    Replies
    1. yes, he is liable to register.As total service provided is more than 10 lakhs

      Delete
  29. Hello Sir, aggregate value up to Rs 10 Lakhs will be in terms of invoices issued/to be issued for taxable services. But in case of advances received for taxable services to be provided in future, whether basic exemption can be availed or service tax has to be paid from the first rupee received? If it has to be paid from the first rupee received as advance whether basic exemption can be availed later while invoicing which shall be done after service is rendered?

    Regards.

    ReplyDelete
    Replies
    1. basic exemption will be available also in this case also. it is covered under services to be provided

      Delete
  30. Dear Sir,
    I have started Travel Agency 8 months back. In the beginning only I have done registration of service tax. At the end of this financial year my total turnover (taxable amount) is less than 10 Lack. Am i eligible for exemption from service tax as my turnover is below 10 Lack? Please advise

    ReplyDelete
  31. Sir,

    If Service is 1st Time become Taxable
    such as ST on ACTOR wef 01st July 2012\

    then
    my Question is
    if an Assessee crossed Rs 10/- Lakhs in P/Y i.e F.y 2011-12
    then Basic Exemption Limit will be available for F.Y 2012-13 or not

    ReplyDelete
  32. Dear Sir,
    if Sale/Turnover are

    2010-11: Rs. 9,60,000/-
    2011-12: Rs. 9,00,000/-
    2012-13: Rs. 9,50,000/-

    Is there any need to have Service Tax No. Registration?

    if No, then can you please provide Government Rules Link/Chapter number in which the same has mentioned.

    ReplyDelete
    Replies
    1. hi friend!
      if turnover during the year exceeds Rs.900000 may be called gross receipts or total receipts require to get registered under the act is mandatory.yeah!service tax still not to be paid unless the limit of Rs. 1000000 not crossed during the year.hence above receipts received than RS 1000000 is eligible to pay tax.

      Delete
  33. Hello Sir,

    I am planning to start a web designing Company and offer my services online, I mean I won't have any office for now, I will work from home, and may be hire employees online. I want to start as a sole proprietorship.

    So I want to know do I need to register my Company before I start off, and if I need to do what will be the procedure.

    Any information in this respect will be appreciated.

    Thanks in advance.

    ReplyDelete
    Replies
    1. EVEN we are also operating from home and not have any office after six year of our operations .......however you have to have service tax registration if services provided are more than 9 lakh in a year

      Delete
  34. Very helpful. Consider this:-
    A professional was not liable for ST till 30-Jun-2012, the gross receipts were though above 10lakh.
    ST registration was taken after the new negative list, where the profession is liable to ST from 1-july-2012. Now this 10lac exemption will start from 1-july-12 as income before will not be 'taxable service as per section 65B(51)'.
    Suppose he is making 2lac per month, as he has been since last one year, he will be liable to ST only after 1-Dec-12 i.e after 10lac starting from 1-july-2012. Please correct me if I am wrong.

    ReplyDelete
    Replies
    1. yes you are correct for fy 12-13.But person can not avail exemption in fy 13-14 as turnover is more than 10 lakh in fy 2012-13

      Delete
    2. Many thanks. Much appreciated.

      Delete
  35. I am a Computer Hardware Trader provides services to customer both Branded and Personal Services . Branded Like Microsoft, Tally, Anti Virus etc are not exempted and Personal Services Like Computer Repair Computer Maintenance is exempted total of both is below 10 Lack but as per Rule for branded services i need to register and collect Tax for Branded Services but actually i am exempted as in total i am below 10 Lacks should i file return separately for Both. Is it OK if i dont collect tax on my personal services.

    ReplyDelete
    Replies
    1. you can file common return .Further as per rule tax is not applicable on non branded services up to 10 lakh

      Delete
  36. dear sir,
    i am running internet cafe for last year. i have total turnover 350000
    per year, i found this article and really want your help should i pay service tax or am i exempted ,
    service tax return necessary for me

    ReplyDelete
    Replies
    1. exempted as turnover is less than 10 lakh

      Delete
    2. dear sir,
      i am running internet cafe for last year. i have total turnover 350000per year, i found this article and really want your help should i pay service tax or am i exempted ,
      service tax return necessary for me


      thanks sir ans my question but sir about my
      service tax return , it is necessary for me
      thanks again

      Delete
    3. if you are registered person then return is mandatory , if not registered then no need to file return ,infact non registered person can not file return at all.

      Delete
  37. dear sir one question again registration for service tax mandatory total turnover 350000per year

    ReplyDelete
    Replies
    1. No , registration is required only if turnover is 900000

      Delete
  38. What if the registered deed is in two names can both enjoy exemption limit in immovable property to 10 lakhs.

    Thank u plz reply me im very confused.

    ReplyDelete
    Replies
    1. yes , both can avail separate exemption limit

      Delete
  39. Good day,

    Rental income in last financial year - Less than 10 lakh

    Rental income in this financial year - (expected)-More than 10 lakh (11.5 lakhs)

    As per your explaination above- "Service tax applicable after 10 lakh"

    Can you explain how much service tax I need to pay in this year?

    Thanks

    Read more: http://www.simpletaxindia.net/2012/09/service-tax-exemption-limit-who-can.html#ixzz2RvEvZ7OG

    ReplyDelete
  40. If you are registered under both services i.e. (Central Excise and Service Tax). As a service provider our turnover is only 3 lacs. If we consider both the services then our turnover is very high. Can we avail the benefit of Service threshold limit of Rs. 10 lacs.

    Kindly confirm.

    ReplyDelete
  41. Started providing Accounting services from 1st April 2013, my billing for FY 2013-14 will be below Rs. 10 Lacs;

    Do I have to register with service tax department, even though, I am within the basic exemption limit of Rs. 10 Lacs.

    Please cofnirm

    ReplyDelete
    Replies
    1. if service are more than 9 lakh then you are required to be registered

      Delete
  42. I am a distributor of a MLM company like AMWAYS. My commission income is above 15Lakhs per year. My question is as follows:-

    1) I get direct credit of my commission from the company.
    2) The company says the what ever commission is paid, includes all taxes.
    3) TDS is deducted normally from such monthly payment by the company
    4) I do not bill the company and no invoice have been raised for
    my commission.

    Can you please explain me is I need to be registered for SERVICE TAX and under which rule/chapter.

    If Yes, than can the SERVICE TAX amount be deducted from the total income since as per the company, the commission includes all taxes.

    If Yes can I revise my I.Tax return by showing less income by the amount payable as ST.

    Your earliest reply will be highly appreciated

    ReplyDelete
  43. Sir,
    Iam Vijay running small unit of manufacturing various componenets.
    We will take service of out side compony for manufacturing process providing man power for manufacturing.

    Please clarify,
    1. is Exemption limit of service tax Rs. 10.00 is applicable for us?
    2.If service tax chargeble, what will be the abatement % for the above service ?
    3. I am already paying excise duty every month, is it applicable for us also to pay service tax, who is already paying excise duty ?
    4.If any person who is doing any type of jobwork for excisable firm is liable to pay service tax ?

    Please clarify the above pionts.

    Rgds,

    Vijay

    ReplyDelete
    Replies
    1. Point wise answer given below
      1.10 limit is available to service provider not service receiver.
      2.No abatement available for manpower services
      3.No exemption available as such to excise payee , however you can claim service tax paid to contractor as input service credit as per cenvat rules while paying the excise duty.
      4.carrying out any intermediate production process as Job work for on which excise duty is payable by Manufacturer is exempted from tax under mega exemption sr no 30 (C) notification 25/2012 dated 30.06.2012
      http://www.simpletaxindia.net/2012/06/negative-list-of-services-revised.html

      Delete
  44. I am an IT Consultant and my receipts during the Financial Year were Rs. 9.75 Lakhs which included Rs. 2.50 Lakh from export of services (services provided to clients located overseas), which is exempt from Service Tax. For the purpose of registration, does the Rs. 9 Lakh limit include the receipts from the exempted services or it excludes them ? Do I have to apply for Service Tax registration immediately or can wait for the domestic receipts to cross Rs. 9 Lakh ?

    ReplyDelete
    Replies
    1. Service tax registration is one time Job and from your fact it seems that your turnover will increase from 9 lakh even 10 lakh sooner or later so you should go far registration.

      Further 9 lakh limit is for taxable service provided , service exempted not to be counted

      Delete
  45. I was not aware of the small service provider exemptions of Rs.1000000 and registered for service tax. I install CCTV system and take intercom AMC. I collected service tax in one such AMC invoice and paid the amount to the government. Later on I came to know of the small provider exemption. Now I am not collecting any service tax from customers. I am filing NIL returns of service tax. Please let me know if I need to mention any details in the returns. I want to avoid paying any penalty later on.

    ReplyDelete
    Replies
    1. Option to pay tax once selected ,it can be changed during the same financial year . So you have to pay tax during this year atleast

      Delete
  46. I run an online protal and have brands selling on my site, which is a market place (invoicing and shipping are done by the brands). Payment will come in through my current account , which will be made to the principal company , after deduction of a commission. If commission income doesn't exceed 10 lakhs , will I be eligible for exemption(sole-proprietorship).

    ReplyDelete
    Replies
    1. yes, you are working as an agent on behalf of actual buyer and sellers ,so only commission amount to be considered for calculate taxable value of services provided

      Delete
  47. Hello Sir,
    I'm an independent software consultant working for Indian software company.My consultancy charges + expenses cross 10 lakhs rupees.
    For brake up
    say my yearly consultancy fee(taxable) is ==> 11 lakhs
    my yearly expense is (non-taxable) ==> 2 lakhs

    Totally 13 lakhs per annum, For service tax payment, do i need to consider 11 lakhs or 13 lakhs?

    Kindly clarify, thanks in Advance.

    ReplyDelete
    Replies
    1. if expenses are incurred on behalf on company and got reimbursed from company like if you have paid domain charges of website for company and recovered from company then these charges are not be included as you have incurred as agent

      however if you have recovered travelling exp,phone and other exp. then it should be included for service tax purpose

      Delete
    2. Thanks Raja Babu for your quick response.

      Delete
  48. Sir,WE ARE running A LARGE unit of manufacturing DUTY FREE MATERIAL.We ARE TAKING service from out side labour contractor for manufacturing process. Please clarify, 1. is Exemption limit of service tax Rs. 10.00 is applicable for us for paying of service tax of contractor who is not registered under service tax registration due to exemption limit 2.If service tax chargeble, what will be the abatement % for the above service ? 3. we are manufacturing exempted product, can we utilise cenvat credit for payment of service tax. 4. If any person who is doing any type of labour work for our company ( who is not eligible for service tax due to exemption limit ), is his service is liable to pay service tax ? whom will pay service tax at what rate? Please clarify the above pionts. - See more at: http://www.simpletaxindia.net/2012/09/service-tax-exemption-limit-who-can.html#sthash.rEqbNEyq.dpuf

    ReplyDelete
  49. Sir,We are the Sales Promotr cum C&F agents of the Cement Company & our receipts for the year less than 1 lakhs. Now Pl. tell us whether service tax applicable on us or not.

    ReplyDelete
    Replies
    1. If receipt of this year as well as of previous year is less than 10 lakh then you can claim exemption as per condition given above

      Delete
  50. Hi,

    I, along with a friend of mine have registered a Parternship firm and we worked only one Project which brought us INR 2.4 Lakhs as revenue. The service provider deducted 10% TDS ( INR 24,000).
    As our Total revenue is way less than the exempted limit of 10 Lakhs, is there a way we can claim the TDS amount of INR 24,000?
    If yes, may you please explain how?

    Thanks in advance.

    Cheers!
    LS

    ReplyDelete
    Replies
    1. TDS is deducted under Income tax rules not under service tax .So refund can be claimed under income tax act . You have to prepare books of accounts and after expense ,calculate Income and income tax ,if calculated income tax is less than tax deducted ,you can claim refund of the balance amount.

      In income tax ,basic exemption of 2 lakh not available to Firm

      Delete
  51. Sir,
    My service tax turnover is around 5 lakhs. While filling return, I selected Exemptions and notification no. 33/2012 ST. I am asked to select serial no. to proceed. Which serial no. should I select for exemption. I am registered under service tax.
    Thanks in advance.

    CP

    ReplyDelete
    Replies
    1. This section has only one option that is 1 so Select serial Number 1 means One

      Delete
    2. Sir,
      Thanks very much for your prompt reply.

      I am facing another problem while filing my returns. I have entered the month-wise turnover amount under Gross Amount ( B 1.1 ) . This amount is reflecting as Net Taxable Value under B.1.14.
      Do I have to enter a Tax Rate under B.1.15 ? -- I have not collected any tax from clients.
      OR should I enter the month-wise turnover amounts again under B1.12 and type in the text-box - Exempted under Small Service Provider. --- Doing this nullifies the Net Taxable Value under B.1.14.

      Please advice.
      Thanks in advance.

      CP



      Delete
    3. you should select 11.1 yes ,11.2 notification 33/2012 sr no 1 then in sr no B1.9 enter same amount as entered in B1.1 after that net amount shown in b1.14 will be nil ,enter zero in in taxable value in B1.15 and tax rate 12,2,1

      Delete
    4. Could not file returns online.
      So, Downloaded the Excel file, filled it up as you instructed and uploaded the XML file.
      It was Successful.

      Thanks very much for your help and Best Wishes.

      CP

      Delete
    5. check status of return be changed to uploaded to filed ,it can still be rejected,hope we will succeed

      Delete
    6. Sir,
      Still does not mention if my returns are accepted or not.

      efiling --> view XML status -- from 01/10/2012 to 31/03/2013 does not show any status.

      When I try efiling --> upload file and upload the XML file, I get the message : Original Return for the selected period already exists. You can not file one more Original Return for the same period.

      When I try Print acknowledgement Receipt, I get the message : Please check the form for following errors : No Records Found.

      Is this normal ?

      Thanks.

      Delete
    7. at e fling >view XML please check date of upload like search for 01.09.2013 to 09.09.2013 not return period dates then return uploaded will be shown check status filed /uploaded /Rejected etc

      & inform good news

      Delete
    8. Sir,

      Sorry for the delay. Checked as per your suggestion. Status shows uploaded.

      Thanks for your help and enthusiasm. Will keep you informed of the progress.

      CP

      Delete
    9. Sir,
      The ACES website is now updated to show my status as FILED.

      Appreciate your PASSION and DEDICATION.

      Thanks and Best Wishes.

      CP

      Delete
    10. Nice work Cp ,You learn very fast ...may god give you every thing you deserve

      Delete
  52. BALA:iam providing mandapkeeper service.my turnover is 3.5 lks .do i have to pay service tax

    ReplyDelete
  53. Sir,

    1. I have been paid commission from the company with TDS deduction for the Job done, my total commission for Fy12-13 is 11,00,000/-. am i liable to pay the service tax.

    pls reply

    ReplyDelete
  54. Dear Raja Babu Sir,

    I am having a firm which does General Contracting and Small Items Trading / Manufacturing. Under Trading / Manufacturing we do Large Format Printing / Acrylic Fabrication Work / Signage Manufacturing / Furniture and Fixture Manufacturing. Under General Contracting we undertake Store Interior Work (carpentry / Electrical / Metal / Painting / Masonry and Plumbing etc. The Trading / Manufacturing bills amount to 4-5 Lacs this year till now. The General Contracting part totals to 55 Lacs (this includes both material and labour put together). I have raised bills worth 27 Lacs where my principals had asked me to consider 12.36% ST on 70% on the bill values. I am yet to raise bills for the remaining amounts. I am a bit confused about the terminologies used in these websites. So please take some time to clarify and guide on the below since I am now being asked for ST number by my principals as payments are pending to be received yet.


    1) What is the meaning of "aggregate value of Taxable Services" which should not exceed 10 Lacs? Does it mean 55 Lacs or The Service Tax amount on 55 Lacs.
    2) Am I exempt from ST or am I liable to pay ST?

    ReplyDelete
    Replies
    1. Dear Raja Babu Sir,

      In my above query sent yesterday, I had mentioned that my Principals had asked me to consider 12.36% ST on 70% of the total bill value. This is a mistake from my side. It is 12.5% VAT on 70% of the total bill value. Sorry for the inconvenience.

      Thanks and Regards

      Delete
  55. Assuming basic Service Tax (ST) exemption remains unchanged at Rs. 10 lac for a FY.

    FY 2012-13 - Invoice Value (Lac) Rs. 9.5 - Register for ST as soon as cross Rs. 9 Lac

    FY 2013-14 - Invoice Value (Lac) Rs. 11 - Start Collecting ST when Invoice Value crosses Rs. 10 lac

    FY 2014-15 – Charge ST for very first rupee, irrespective of what total Invoice Value will be in whole of the FY ;
    Suppose in this FY Total Invoice Value drops below exemption limit of Rs. 10 lac

    FY 2015-16 – What to do ? As in previous FY total Invoice Value falls below Exemption Limit ?
    Can I stop collecting ST in FY 2015-16 ?

    ReplyDelete
    Replies
    1. Yes , In Fy 15-16 you have to options.
      1. Charge service tax from customer for very first rupee and avail cenvat credit.or
      2. Avail exemption limit up to 10 Lakh but Cenvat credit can not be claimed and charge ST after 10.00 lakh Billing .

      You may select option according to your wish /more beneficial to you .

      However if you are opting for second option you should send a information to your Jurisdictional Officer as suggested also in the post above .

      Delete
  56. Respected sir,

    Exemption to small scale providers is not applicable to taxable services provided by a person under a brand name or trade name,whether registered or not, of another person what does this mean?

    If i am providing BPO services to my client which includes customer calls and responding to customer emails on behalf of my client (from my client's email address and using client's company's name) does this mean that i will not be eligible for small service providers exemption since i am using his name while replying to his customers.

    Are these not covered under incidental services since i am raising invoice to my client and email and phone services provided to client's customers are incidental, while providing services to my client?

    ReplyDelete
    Replies
    1. in my opinion ,BPO is not covered under this clause

      Delete
  57. Dear Sir,
    We are registered under WORKS CONTRACT SERVICE and we come under PARTIAL REVERSE CHARGE of 50%.
    Request you to kindly provide us the Exemption Notification No. to be entered in A11.2 for entering amount in B1.6(Amount payable under partial reverse charge) and
    the Abatement Notification No. to be entered in A12.2 for entering amount in B1.11(50% deduction under partial reverse charge) while filing Return.
    Thanks and Regards.
    Shivraju

    ReplyDelete
    Replies
    1. In both the cases file notification 30/2012 and sr no 9

      Delete
  58. Sir Raja Babu i have a restraunt having air condition facility i have just received service tax registration. I want to know whether i can avail Small Service provider exemption of 10 lacs on gross amount collected or as per Composition scheme i can avail exemtion upto 25 lacs as 40% of 25 lacs collected is chargeable. I want to know whether i have to consider 10 lacs limit or 25 lacs limit. Please clarify in detail with appropriate section and notification

    ReplyDelete
  59. Sir i want to know whether i have to consider gross 10 lacs limit for basic exemption or i have to consider limit according to composition scheme. please provide me appropriate guidance sir. waiting for your reply

    ReplyDelete
  60. Dear Raja Babu,
    We are a Pvt Ltd Co running Travel Agency (Non IATA) working as online partners for various companies in India. We are into 1. Air Ticket Agents 2. Package Tour Operator. My Questions: 1. What is is the Exemption limit to apply for Regn of Service Tax ?
    2. As an Air Ticket Agent, we should take into account the gross commission earned or gross turnover during the year for taxation purpose ?
    3. Exemption Limit is Total Gross turnover or After abatement of figures ?
    4. Can we opt for Composition scheme as Air Ticket Agent ?
    Awiating Reply

    ReplyDelete
  61. sir I am providing 7-9 labor men for housekeeping in a government contract and the total service amount will be less then 10 lacks for a financial year. service tax will applicable here or not? if yes who will pay service receiver or provider? please reply

    ReplyDelete
  62. This Page answered all my doubts regarding Service tax. Thanks a lot. I am fortunate to have access to your site. My service amount is less than Rs.10 lakhs for the past few years. So, I have not registered for S.T. But, On seeing our Advt.s in yellow pages, the Service Tax dept has sent us a letter with a printed intimation asking me to register for Service Tax and also to avail CES - Voluntary Compliance Encouragement scheme before 31st December. Should I respond them or skip that letter? Can I offer two services in two different firm names having same address and can avaiI the exemption limit for both the services? I am well under exemption limit in both the services in different firms, but in the same premises.

    ReplyDelete
    Replies
    1. You can claim exemption of 10 lakh in each firm ,if these are partnership firms or one is partnership firm and other is prop.

      However if you are owner of two concerns on diff. name from same place or diff. places as prop. then exemption of 10 lakh can be claimed once only not for each firm separately.

      Further if you are providing both these services under prop. firm but total of both the services provided is less than 10 lakh then you can claim exemption 10 lakh .

      Delete
  63. Sir, I was operating a gym and got registered under Service Tax in 2004. In 2009-10 i surrendered my service tax registration as i closed my business and now again started to provide the same service. Can i claim the benefit of this notification ? Please clarify.

    ReplyDelete
    Replies
    1. Yes , you can claim the benefir of this notification/ 10 lakh exemption limit

      Delete
  64. Dear Sir

    I want to know, whether a small service provider is liable to pay service tax on the service provide before taking service tax registration. Please clear.

    Thinking you

    SUBHASH CHANDER

    ReplyDelete
    Replies
    1. Please ask with example and complete data

      Delete
  65. Can 10 lakh limit includes amount received frm company where company is liable to pay on reverse charge.

    If individual provide services to both government n company thn 10lakhs limit for both invoices as companies liable on reverse charge

    ReplyDelete
    Replies
    1. Service tax paid under reverse charge is not be included in 10 Lakh limit

      Delete
  66. Dear All,

    Kindly confirm if service tax applicable for yoga class

    Regards,

    D Gnanasekaran

    ReplyDelete
  67. I am getting my house (3500 square feet) built in my own plot , by a local contractor. Do I have to pay service tax ? This plot is a stand alone, and not part of a group housing or society or residential complex.

    ReplyDelete
    Replies
    1. service tax is not applicable on single residential unit under mega exemption clause 14b of notification 25/2012 dated 20.06.2012

      http://www.simpletaxindia.net/2012/06/negative-list-of-services-revised.html

      Delete
  68. Sir,
    I am the sub broker, and I am aware that the sub broker is not liable to pay service tax, because mega exemption notice/negative list. But received sub brokerage more than 10 lakhs. Whether Registration is compulsory? If yes, what is the action if not taken RC.
    please reply,
    thanks,
    P.Sivakumar
    Tamil Nadu

    ReplyDelete
    Replies
    1. Registration is required only if taxable service provided is more than 9 lakh .As you are providing exempted /non taxable service ,so registration is not required

      Delete
  69. Whether Service Tax Registration is necessary for mega exemption/negative list cases, if exceed Rs.10 lakhs

    ReplyDelete
    Replies
    1. Registration is required only if taxable service provided is more than 9 lakh .As you are providing exempted /non taxable service ,so registration is not required

      Delete
  70. Sir,
    I am a Small Scale Service Provider with Turnover Rs.500000/-.
    I am accepting a contract of Rs.200000/- on a condition that Service Tax is inclusive and will be paid to Govt. by me.

    Please tell How and Where I should declare that I am not taking benefit of thresh hold limit.

    Also kindly suggest.. Whether I can avail the benefit of this limit of Rs. 10lacs for my other business clients.

    Pls suggest

    ReplyDelete
    Replies
    1. No , you can not opt for exemption client wise ., either you can avail exemption as a whole or go for payment of service tax

      Delete
  71. HI, Sir,
    my Query is that I am a Work Contractor providing Works Contractor Service. I am providing service to Pvt. Ltd. Co., My Contract value for Original works (40% as per NN. 24/2012) is Rs.50 lakh. I am in partial Reverse charge (50% as per NN. 30/2012).

    Contract Value = 50 lakh
    Taxable portion = 20 lakh
    Reverse charge= 50%
    Net Taxable value = 10 lakh.

    Query?
    (1) whether I have required for Service Tax Registration ?
    (2) Can I claim SSI exemption of Rs.10 lakh ? if yes what will be my service tax liability (nil or 10,00000 * 12.36% = 123600?

    ReplyDelete
    Replies
    1. Ans:
      (1)Yes
      (2)No
      The reason is that service provided by you is more than exemption limit .

      Delete
  72. Dear Mr Raja,

    Few months before. I had taken your view on service tax. I was satisfy with all your answers instead of my CA. Now few days back I had discussed with some professional for service tax matter. It will be good if you can solve this also.
    1) I am working in Pvt Ltd. company. We provide software to school & other than schools. School does not cover in service tax & we do not charge service tax from them. Its non taxable services & other than schools are taxable. We maintain single books of accounts. So my question is can we take service tax's input benefit, which we give service tax to other i.e. telephones, professional fees, travel, hotel etc. Now I am taking cenvet credit in the ration of 80:20. Is there any notification, if yes please share.
    2) We also take some service from advocate/rent a cab & in this case we also deposit service tax in reverse charge timely. My question is can we take input benefit for such kind of taxes or not.
    3) If we pay service tax in reverse charge. Should we amend in our registration certificate also.
    Please confirm
    Regards
    Sanjeev

    ReplyDelete
    Replies
    1. 1) Yes, you can avail cenvat credit benefit as provided under rule 6(1) to 6(3) .Further there is no 80:20 rule known to me
      you can follow following links also for more details
      http://www.dateyvs.com/service-tax/cenvat-credit-and-service-tax/cenvat-exempted-goods-and-services/
      2) Cenvat credit is available on service covered under reverse charge ,if it is covered under input services .
      3.yes ,you should got service tax amended .You can apply online ,just add additional services .
      regards

      Delete
  73. Sir, i want to clear whether Service Tax is payable on transportation charges paid to local truck owner who does not issue Consignment Notes. Being a company (biscuit industry) we have taken Service Tax Registration under GTA and were paying Service Tax only on Transportation Charged paid to Registered Transporters. Pls clarify..
    Sawinder Singh
    Jorhat Assam

    ReplyDelete
  74. Dear Sir,

    I provide service to various companies for maintaining their gardens and supply manpower for the same.

    As per the negative list, can I claim exemption as being an agricultural activity and supply of farm labor? My services include some of the agri services listed in the negative list: tending, pruning, cutting, cleaning, trimming, etc.

    Thanks in advance.

    ReplyDelete