Service tax calculation on small scale service provider???

This query is : Resolved

Natasha Mourya (Querist)
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06 January 2015 Service tax is not applicable if amount of different invoices issued of services rendered during preceding year doesn't exceed Rs 10 lac. for instant:-
Suppose 4 bills are issued during the FY 12-13 by service provider.
Bill no1: Amount 4 lac. service tax not applicable.
Bill no2: amount 4 lac. service tax not applicable.
Bill no3: amount 2 lac. service tax not applicable.
total amount of 3 bills don't exceed 10 lac that's why no tax liability of service tax will be applied.
Want to know, would the same exemption be applied in the next financial years or service tax is applicable the moment next bill is raised becoz it exceeds the exemption limited of Rs: 10 lac????

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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06 January 2015 Same exemption is available in the next year but has to be registered under service tax as turnover exceeded 9 lakhs.

Natasha Mourya

Natasha Mourya (Querist)
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06 January 2015 Seetharaman, year in which he gets registration, exemption is available upto Rs 10 lac, & in the next year exemption limit gets decrease from 10lac to 9 lac. would the exemption be decreasing from year to year or if his service amount of different years are below than the exemption limit, would he be entitled to pay tax???

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CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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06 January 2015 Irrespective of registration 10lacs exemption limit is available until his turnover exceeding 10lacs. Once exceeded the limit no exemption from next year.

CA AnKiT BoHrA (AB)

CA AnKiT BoHrA (AB) (Expert)
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06 January 2015 If in the previous financial year aggregate value of taxable services provided was more than 10 lakh but this year aggregate value of taxable services provided is less than 10 lakh them you start paying service tax from rupee one.

Exemption of ten lacs is for one time only.. once u got registered with service tax, there is no exemption u had to pay it from rs 1

Natasha Mourya

Natasha Mourya (Querist)
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07 January 2015 Ankit Ji, Suppose in FY11-12, amount of total services Rs 5lac, in FY12-13 amount services Rs 3 lac, in 13-14 amount 2 Lac, & in FY 14-15 amount of service tax 3 lac, Does it mean registration will take place in FY13-14 becoz it cross the limit of service tax registration & service will be chargeable to tax in FY 14-15, becoz it exceeds the exemption limit of Rs: 10Lac.
Is above calculation is correct????????

sudarshan

sudarshan (Expert)
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08 January 2015 CA.Ankit, are you sure once registration is obtained , no exemption can be claimed and SSI exemption is one time?

i am reproducing(part) article written by
CA. Kamlesh Singh Chauhan
FCA, LL B, DISA(ICA)
Email:
ks_chauhans@yahoo.com

What is the previous year and current year taxable turnover criteria to reckon “aggregate
value” for the applicability of threshold exemption: For the entity carrying on business in previous
rear also, aggregate value of taxable turnover should not exceed Rs. 10 lakhs to avail threshold
exemption in current year. Further, in current year, taxable turnover eligible for falling in “aggregate
value” upto Rs 10 lakhs will remain exempt and afterwards such turnover/receipts become taxable. It is
pertinent to mention here that applicability of this exemption notification is evaluated by checking
previous year’s turnover only, so if the entity exempted in one year and taxable in ensuing year, may
again become eligible and exempted under this notification in the current year if it falls within the
specified limit of “aggregate value” in any previous year.