10 August 2010
Yes. With effect from 1-3-2008, a new provision 6(1A) has been incorporated in Service Tax Rules, 1994, whereby service tax can be paid in advance to the credit of the central government and adjust the amount so paid against the service tax which he is liable to pay for the subsequent period. This according to me cover paying service tax on accrual basis.
15 August 2010
for payment of service tax on accrual basis, there is no problem but you cant take cenvat/input credit on mercantile basis as the same are linked with your payments to vendor/service provider.
in fact service tax on services provided to group companies is now a days payable on mercantile basis irrespective of status of receipt of payment, meaning thereby that partly accrual system is getting into the service tax mechanism as well.
16 August 2010
Thanks a lot 2 u all... it means that there is no restriction on payment of Service tax on accrual basis...but u can take credit of only that much amt. for which u have made the payment..
CAclubindia
