20 August 2010
I have deducted service tax @ 12.5% for providing service to a Client for financial year 2009-10. At the time of filing service tax return I knew that actual service tax rate is 10.5%. I deposited the service tax @10.5% in service tax return. But till that the accounting year was over and the accounts of that client have been audited. Now he can not make any adjustment in the accounts of Financial year 2009-10. What treatment I should make in my accounts before audit.
21 August 2010
Ms Menka, the service tax rate is 10.3% and not 10.50%. Since, you have collected service tax @ 12.5%, you shall deposit the whole amount with the Central Government. So, in my view you should deposit the differential amount with the C.Govt and revise the service tax return.
CAclubindia
