REGISTRATION UNDER SERVICE TAX ACT:- Any service provider, who is covered under this act, must get registered with the Central Excise Department.
EXEMPTION LIMIT FOR SERVICE TAX
If the value of taxable services during a financial year is up to Rs. ten lakhs then no service tax shall be charged by the service provider.
WHO IS COVERED UNDER SERVICE TAX
Any person who provides the taxable services and total receipts during a financial year are more than Rs.10 lakhs then the concerned service provider will charge the service tax at the applicable rates and deposit with the concerned authorities.
Once the service provider is registered under service tax act after crossing the limit of Rs.10 lakhs, the concerned service provider shall be supposed to charge service tax even the services in next financial are less than Rs. ten lakhs.
For example:- Mr. X is taxable service provider. His taxable services during financial year 2012-13 were Rs.8 lakhs. He was not liable to service tax for financial year 2012-13. In financial year 2013-14 his taxable services were Rs.12 lakhs. In this case he had pay the service at the applicable rate on the services of Rs.2 lakhs i.e. after crossing the limit of Rs.10 lakhs. Now. in financial year 2014-15, his taxable services were Rs.7 lakhs. In this case he is supposed to charge service tax though his service are less than 10 lakhs.
It is simple from above example that one the taxable service provide is registered under service tax act, he has to charge the service tax on the taxable service whether the services are more than 10 lakhs or less than 10 lakhs.
PAYMENT OF SERVICE TAX
Every person who is liable to collect the service tax must deposit the amount of service tax with Central Excise Department as under:-
- In case of individual, proprietorship concerns and partnership firms, service tax must be deposited on quarterly basis. The due date for payment of service tax is the 5th immediately after the close of the respective quarter. For example:- for June quarter, the due date shall be 5th of July and so on. However the payment of service tax of last quarter i.e. January to March must be made by 31st March itself.
- In case of any other service provider other than above, the service tax must be deposited on monthly basis. It must be deposited within 5 days of close of month. For example the service tax for the month of April must be deposited up to 5th of May. However, service tax relating to March must be deposited by 31st March itself.
- The service tax should be deposited in designated banks through challan number GAR 7. The bank will stamp the challan with CIN (Challan Identification Number) which has 3 parts namely:- (1) 7 digit BSR code of bank where the tax amount is deposited (2) Serial Number of Challan and (3) Date of receipt.
- With effect from 01.01.2014 it has become mandatory to deposit service tax through E-payment system if the assessee has paid service tax of Rupees one lakhs or more during a previous year. Any other assessees also can pay online.
- The amount of service tax should be rounded off in rupee.
FILING OF SERVICE TAX RETURNS
Every asessee who is covered under service tax act is supposed to file the return of service tax collected as under:-
- Return is to be submitted in Prescribed Form by Central Excise Department.
- Return is to be submitted on half yearly basis i.e. April to September and October to March.
- The half yearly return must be filed within 25 days from the end of the half year. For example:- first return should be submitted before 25th of October and second return should be filed before 25th of April.
- The facility of E-Filing return is also available to all type of assessees.
SERVICE TAX REGISTRATION NUMBER
13 digit registration number is allotted to the assessee on the basis of PAN Number. First 10 digits contain PAN number + ST + 001 or 002 or 003 (if same person is registered for more than one place then 002, 003 etc.).
Rate of Service Tax
General Catagory: 12% + 3% as EC + S&HEC on service tax. (Net 12.36% of Service Charges)
With effect from 01.06.15 the rate of service tax is being increased to 14%. No Education Cess and Senior and Higher Education Cess shall be charged on service tax.
The Central Government of India also has proposed Swachh Bharat Cess 2% on any or all taxable service. Date of imposition of Swacch Bharat Cess is not declared till date. It can be declared any time by Central Government.
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