FAQ Guide for Filling ST3 Returns

A Guide to e-filling of ST3 Returns

Introduction:

There are two types of e-filing of ST3 returns. One is filling of information in the downloaded excel utility then converting excel utility file into xml format and uploading the same in ACES. The other type is the online filling of the information in the ST3 returns and then submitting the same. For the quarter July to Sep’2012, no online filling facility is made available as of date. So the only option available is filling of downloaded excel utility. In view of this reason, this guide discuss about only this option only.

Before you begin:

1. For e-filing of ST3 return, ensure the following in the computer which is used for filing of ST3 returns.

a. The version of excel software should be 2003 version and above.

b. File compression software like winrar, winzip.

c. Please make sure the system date is correct.

2. The excel utility is required to be downloaded from the website www.aces.gov.in. The path for downloading excel utility is as follows;

www.aces.gov.in   DOWNLOADS  Click here to Download utilities

3. Excel utility gets downloaded in as compressed file. Then it is required to extract the same is the file compression software.

4. After opening the excel utility, it is required to enable the execution of macros in the sheet. This enabling of macros vary depending upon the type of excel version we are using.

Microsoft Excel 2003:

Navigate through the excel menu option to reduce the level of security in executing macros:

Tools             Macros             Security            Low     Or

Tools             Macros             Security            Medium

Save the excel utility and re-open it.

Microsoft Excel 2007:

Navigate through the excel menu option to reduce the level of security in executing macros:

Excel Options   Trust Center   Trust Center Settings     Macro Settings   Enable all macros

And

Excel Options   Trust Center   Trust Center Settings     Active X Settings

Enable all controls without restriction and without prompting

Save the excel utility and re-open it.

Microsoft Excel 2010:

When you open the excel utility, yellow message bar appears with a shield icon and enable content button.

Click on the enable content button to enable macros.

Save the excel utility and re-open it.

Filling of “Return” Part:

1.  All the green cells in the sheet are required to be filled in.

2.  You are not allowed to enter data in grey cell.

3.  All the fields provided with asterix symbol (*) are mandatory and compulsorily information is required to be provided.

Note: Once “Return” sheet is duly filled in; validate it, automatically rest all other sheets will be added through macro sheet.

FAQS ON HOW TO DISCLOSE VARIOUS ITEMS IN ST3 RETURNS:

1. Service Provider Having Previous Year Taxable Turnover of Rs. 50 lakhs or less Paying Service Tax on Receipt Basis:

Query: I am a service provider having previous year taxable turnover Rs. 50 lakhs or less and I am paying service tax in current financial year on receipt basis. How should I disclose my service turnover in the ST3 Returns?

Answer::In such a case, value of taxable services of service provider is the amount received by the service provider during the period. It would be sufficient if such receipts are shown in column B.1.3 and there is no need to show total value of billings made during the period.

2.  Service Provider Paying Service Tax on the Basis of Point of Taxation Rules:

Query: I am service provider paying service tax as per Point of Taxation Rules, 2011. I have received advances during the period for taxable services. Invoices are issued only for some of these advances but not for all. In case of completed services, invoices are not issued for some completed services even after expiry of 30 days from completion of service. How do I need to disclose my value of taxable services in the ST3 return?

Answer::For the purpose disclosing the value of taxable services in the ST3 returns, turnover during the period is required to be segregated into the following categories.

a.  Gross amounts charged for which invoices are issued. This turnover includes advances received for which invoices are issued, export turnover, exempted turnover, amount charged as pure agent and reimbursable expenditure claimed. (These amounts are to be shown in B1.1)

b. Advances received for which invoices are not issued. (These amounts are to be shown in B1.2)

c. Completed services for which invoices are not issued within 30 days of completion. (These amounts are to be shown in B1.4)

3.  Service Provider Paying Service Tax under Partial Reverse Charge:

Query: I am service provider engaged in supply of manpower services. I am paying service tax on 25% of the value of taxable services provided by me. How to disclose my turnover in the ST3 returns?

Answer: Mention that you are paying service tax as a service provider under partial reverse charge by selecting ‘YES’ from the drop down menu in column A10.3. Select the specified percentage of turnover on which you are required to pay service tax in column A10.5, Then it is required to indicate that your are claiming exemption for a portion of value of taxable services under partial reverse charge mechanism. This can be done by selecting ‘YES’ in the drop down menu in column A11.1. Specify that you are claiming exemption under Notification 30/2012-ST and its corresponding serial no.

Then Compute the total value of taxable turnover under POT basis. These include the following.

a) Value of taxable services provided/advances received during the period for which invoices are issued.

b) Advances received during the period for which invoices are not issued.

c) Completed services for which invoices are not issued within 30 days

After arriving at the value of taxable services as per POT in the above manner,. mention this amount in column B1.6. With respect to these services, no other columns (B1.1, B1.2, B1.3,B1.4) are required to be filled.

Then the extent of value on which service receiver is required to pay service tax shall be claimed as exemption by mentioning amount in column B1.9

4.  Service Receiver Paying Service Tax Under Partial Reverse Charge:

Query: I am a service receiver receiving certain taxable services on which I am required to pay service tax under partial reverse charge. How to disclose this taxable turnover in the ST3 returns.

Answer::Mention that you are paying service tax as a service receiver under partial reverse charge by selecting ‘YES’ from the drop down menu in column A10.4. Select the specified percentage of turnover on which you are required to pay service tax in column A10.6.

Arrive at total value of the taxable turnover by adding the following items.

a) The value of services received for which payments are made during the period.

b) The value of services received during the period for which payments are not made within 6 months from the date of invoice.

After arriving at the value of taxable services as per POT in the above manner, mention this amount in column B2.7. With respect to these services, no other columns (B2.1, B2.2, B1.3, and B2.4) are required to be filled.

Then the extent of value on which service provider is required to pay service tax shall be claimed as exemption by mentioning amount in column B2.9

5.  How to Disclose Exported Services Turnover:

Query: I am a service provider having export services. How should I disclose my value of taxable services?

Answer: Prior to 01.07.2012, export services are taxable but exempted. From 01.07.2012 onwards, export services are not taxable in terms of Place of Provision of Services Rules, 2012. Further for the services provided prior to 01.07.2012, the point of taxation for these services is on receipt basis. So whatever export realizations during current period towards the value of taxable services should also be considered.

The export turnover should contain the following;

a) Value of export services provided during the period and

b) Export realizations made during the current period for the services exported during the preceding period.

These details should be mentioned in B1.1

The entire value of exports should be shown as exempt by mentioning the amount in B1.8

6. Service Receiver Receiving Services under Reverse Charge:

Query: I am a service receiver receiving certain taxable services for which I am required to pay entire service tax under reverse charge mechanism. How should I disclose this liability in my service tax return?

Answer: Mention that you are paying service tax as a service receiver under partial reverse charge  by selecting ‘YES’ from the drop down menu in column A10.4 . Select the specified percentage of turnover on which you are required to pay service tax in column A10.6. In this case, it is to be shown as 100%.

Arrive at total value of the taxable turnover by adding the following items.

a)  The value of services received for which payments are made during the period.

b) The value of services received during the period for which payments are not made within 6 months from the date of invoice.

After arriving at the value of taxable services as per POT in the above manner, mention this amount in column B2.7. With respect to these services, no other columns (B2.1, B2.2, B2.3, and B2.4) are required to be filled.

7.  Imported Services from Non-Taxable Territory:

Query: I am service receiver receiving imported services from non-taxable territory. The place of provision of these services as per Place of Provision of Services Rules, 2012 is the Indian Taxable Territory. How should I disclose my tax liability in the ST3 return?

Answer: Mention that you are paying service tax as a service receiver under section 68(2) by selecting ‘YES’ from the drop down menu in column A10.2.

Arrive at total value of the taxable turnover by adding the following items.

a)  The value of services received for which payments are made during the period.

b) The value of services received during the period for which payments are not made within 6 months from the date of invoice.

After arriving at the value of taxable services as per POT in the above manner, mention this amount in column B2.5. With respect to these services, no other columns (B2.1, B2.2, and B2.4) are required to be filled.

8.  Services Received from Non-taxable Territory Other than Imports:

Query: I am service receiver receiving imported services from non-taxable territory. These services are not taxable in India as per the Place of Provision of Services Rule, 2012. How should I disclose these payments in the ST3 return?

Answer: Mention that you are paying service tax as a service receiver under section 68(2) by selecting ‘YES’ from the drop down menu in column A10.2.

Arrive at total value of the taxable turnover by adding the following items.

a) The value of services received for which payments are made during the period.

b)  The value of services received during the period for which payments are not made within 6 months from the date of invoice.

After arriving at the value of taxable services as per POT in the above manner, mention this amount in column B2.6. With respect to these services, no other columns (B2.1, B2.2, B2.3, and B2.4) are required to be filled.

The entire value of services received from non taxable territory other than Imports should be mentioned under B2.12 i.e. any other deductions please specify

9.  How to Disclose Exemption Benefit Claimed for Certain Services:

Query: I am service provider providing services which are exempted under Notification 25/2012-ST dated 20.06.2012. How am I required to claim the benefit of this exemption notification?

Answer: Mention the fact that you have claimed exemption benefit in column A11.1 by selecting ‘Yes’ from drop down menu. After that add notifications and corresponding serial no’s under which exemption is claimed.

Subsequently mention the entire value of services which are exempted under column B.1.9.

10. How to Disclose Abatement Benefit Claimed for Certain Services:

Query: I am a service provider providing residential complex services paying service tax on 25% of the gross consideration by claiming the benefit of Notification 26/2012-ST dated 20.06.2012?

Answer: Mention the fact that you have claimed abatement benefit in column A12.1 by selecting ‘Yes’ from drop down menu. After that add notifications and corresponding serial no’s under which abatement is claimed.

Subsequently mention value of services to the extent of abatement under column B1.11

Query: I am a service provider engaged in providing works contract services. Some of the contracts executed are original works and some are other than original works. The abatement rates are different. How to claim the abatement benefit?

Answer: Mention the fact that you have claimed abatement benefit in column A12.1 by selecting ‘Yes’ from drop down menu. After that add notifications and corresponding serial no’s under which abatement is claimed. In the instant case, it is Notification 24/2012-ST.

Subsequently mention value of services to the extent of abatement under column B1.11. This amount is nothing but the sum of the following;

a)  Abatement value at 60% of gross amount charged in case of original works (Taxable value is 40%)

b)  Abatement value at 40% of gross amount charged in case of other than original works (Taxable value 60%)

11. Is It Required to Disclose Negative List of Services?

Query: I am a service provider engaged in providing negative list services. Whether I need to mention the value of taxable services under ‘payable services’ column?

Answer: We understand that there is no requirement to disclose other than negative list services. Only requirement is to disclose this part of turnover under I.2.2. under “CENVAT” sheet for the purpose of Rule 6(3) adjustment.

12. Deductions under Pure Agent:

Query: I am a service provider engaged receiving certain payments from my service receivers as a pure agent while performing my services. How should I disclose these amounts in ST3 returns?

Answer: The amounts claimed from service receiver as a pure agent should be included under gross amount charged in column B1.1. The said amount is excluded from value of taxable services by showing it separately under column B.1.10.

13. Reimbursement of Out of Pocket Expenses:

Query: I am a service provider receiving certain amounts from my taxable service receivers as reimbursements and I have charged service tax on the same in the invoices issued by me. How should I disclose these receipts in my ST3 returns? In case I have not charged and paid service tax in view of ambiguity about taxability of these expenses, then how should I disclose these receipts?

Answer: These amounts claimed from service receiver as reimbursement expenses. should be included under gross amount charged in column B1.1. As service tax is collected, there is no need to include the said amount in deductions part.

In case if no service tax is collected and paid on reimbursements, then the same should be mentioned under column B1.12 under any other deductions by specifying the nature of deduction.

14. Excess Payment Adjustments:

Query: I am a service provider paid excess tax in previous month due to mistake in computation which is now adjusted against liability in the current month. How should I reflect this adjustment in ST3 return?

Answer: This adjustment is made in accordance with Rule 6(4A) of the Service Tax Rules, 1994. This adjustment is required to be intimated to service tax department in writing. This adjustment should reflect in “Paid Service” Sheet in column D5. The document acknowledgment no/ references no, date and amount should be given in column H2 of “Challan Service”. If no intimation is given previously, then write a letter to Department intimating the same fact to Department before filling the return. Mention that date.

It is not possible to claim this benefit without mentioning the source document details.

Query: I am a service provider paid service tax upon issue of invoice under POT basis. Subsequently, customer renegotiated the invoice amount due to deficient provision of service or any other terms contained in the contract. Revised invoice is given in subsequent month. The excess tax paid as a result of this in the previous month is adjusted against the current month ST liability. How should I reflect this adjustment in ST3 return?

Answer: This adjustment should be made in accordance with Rule 6(3) of the Service Tax Rules, 1994. This adjustment should be reflected in the column D4 of “Paid Service”.

It is not possible to claim this benefit without mentioning the source document details.

The source document for such adjustment should be mentioned in column H2 of “Challan Service”. It is mentioned in the instructions of CBEC, the source document for this adjustment is the return of the corresponding previous period in which excess payment is made. However we understand in some cases, the month in which excess payments are made as well as the month in which adjustment is made may fall in the present period for which return if filed. In such a case, it would be ideal to give reference to revised & initial invoice or credit notes issued to service receivers. Then the fact of such adjustment should be intimated to ST department in writing along with copy of these documents.

15. Property Tax Adjustment for Renting Services:

Query: I am a service provider paying service tax under renting of immovable property services. I have not claimed property tax adjustment for the past periods as I have paid property tax now. Now I am claiming this benefit. How should I make this adjustment?

Answer: The adjustment of excess service tax paid in the previous periods/months on account of not claiming municipal taxes deduction benefit can be claimed within one year period after payment of municipal taxes as per Rule 6(4C) of Service Tax Rules, 1994. This adjustment required to be shown in column D6 under “Paid Service” sheet. Further the details of challan/document no of municipal taxes payment receipt along with amount is shown in Column H2 of “Challan Service” sheet.

16. Disclosure of Arears, Interest, penalty, and other amounts etc,. and their corresponding source documents::

By: CA. Kakarla Manindar