20 June 2011
A company was in the business of HOTEL industry which has been made taxable in Service Tax from 1st of MAY, 2011.
The company had collection of 50 lakhs as room rent in the previous year.
My Question is whether the company has to pay service tax from 01/05/2011 only or should it wait for its receipts to cross 10 lakhs in the current year before starting payment of service tax as this is a new service.
Will the compnay be eligible for 10,00,000 exemption or not.?
21 June 2011
but sir, isn't it that because the business was in existence in the previous year also and the turnover is 50 lakhs, so he has to pay service tax from the first day of service been made taxable.
21 June 2011
No its not like tht for calculation of limit of 10.00 lakhs you have to add value of taxable services provided during previous year but as in previous year service was not taxable so that receipt can not be taken into account for 10.00 lakh limit. So start paying service tax only after receipt towarads "TAXABLE SERVICE" exceeds Rs 10.00 lakh
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