Service charge covers under abatement scheme????

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Deepak (Querist)
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23 March 2012 Is Service Charge Covers Under Abatement Scheme????
For eg-
Bill of Restaurant

Food 100
Beverage 100
Service Charge 50

VAT(200*12.5%) 25
Service Tax({(100+100+50)*30%}*10.3%) 7.725

Question is:-

IS VAT & SERVICE TAX CALCULATION IS CORRECT????

Are VAT should also be considered in calculating Service Tax i.e,
Service Tax({(100+100+50+25)*30%}*10.3%) 8.4975 ??????? Even If company opts for Composition Scheme????????

Deepak

Deepak (Querist)
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23 March 2012 Dear Experts,

Pls. give ur valuable advice.......

Thanks & Regards

CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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27 March 2012 Dear Deepak,

First of all, the rate of service tax is changed to 12.36% and it will be charged on 40% of the total amount.(W.E.F 01/04/2012)
Total amount shall not include the amount of VAT Charged on the bill.
there is no composition scheme as such in service tax.opting of Composition scheme under VAT does not alter the answer.

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Deepak

Deepak (Querist)
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27 March 2012 Dear Expert,

Can you pls. clear my doubt regarding Service charge.....

i.e., Is service tax on service charge is 12.36% or (12.36% * 40%)

& also can you pls. provide me the supporting for this change in Abatement rate from 70% to 60% on Restaurant Service....

Thanks a lot sir....

CA Kishore Tallam

CA Kishore Tallam (Expert)
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31 March 2012 Dear Deepak,
The CBEC vide notification no 11/2012 dated March 17, 2012 notified Service Tax (Determination of Value) Amendment
Rules, 2012.
Vide the said rules, the taxable value of consumption at a restaurant shall be 40% of Gross bill amount excluding VAT. There is no concept of abatement here. If it is for outdoor catering, then 60% shall be substituted in above. If the goods are supplied at free of cost and cost is not ascertainable, then fair market value of such goods and services shall be taken.

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Deepak

Deepak (Querist)
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02 April 2012 Dear Experts,

Thanks alot for your replies....

Abatement 40% is applicable on ACCOMODATION only or for MEALS also at the restaurant....

For this pls. refer
http://www.iato.in/Revised-Service-Tax-2012.html

Pls. do give ur suggestions.....

CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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02 April 2012 Earlier the Abatement on hotel accomodation was 50% now it is reduced to 40% in the proposed budget.
For meals-
If it is provided by a restaurant then value of taxable service will be 40% of the gross amount charged(i.e 60% abatement)
If it is outdoor cateror, then value of taxable service will be 60% i.e 40% abatement.

Deepak

Deepak (Querist)
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02 April 2012 Dear Expert sir,

Thanks alot......

Only one more thing I want to ask from you is that--

Cany anybody pls. give me the effective date of

CBEC vide notification no 11/2012 dated March 17, 2012

i.e., w.e.f._______________???????

pls. provide me the source also i.e., links
because i have to show this to my boss..

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CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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03 April 2012 The proposed changes will come into effect from the date to be notified post enactment of bill.

Only rate of service tax changed to 12.36%.Tthe date Abatement is yet to notified.

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Deepak

Deepak (Querist)
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03 April 2012 Thank u sir......