service tax exemption of 10 Lac ?
Querist : Anonymous
What will be the answer in these cases :-
Below are the figures of first FY of operation
1. Single contract is of 9.5 Lacs (So if
10.3% service tax is to be added, it
amounts to 10.48 Lacs)
2. Single contract of 7 Lacs & next
contract is for 5 lacs
3. Single contract is for 12 Lacs.
Kindly advice
1. You may not covered under service tax
2 & 3. you are covered under service tax and need to register and charge service tax from the next financial year
tax will be charged if the limit crossess Rs. 10 lacs
Querist : Anonymous
1. The services has to be registered under work contract services under section 65(105)(zzzza) since the taxable service crossed Rs. 9 Lakhs. No service tax need to be collected and paid since threshold limit of Rs.10lakhs is not crossed.
2. Registration has to be taken .Threshold limit can be availed. Service tax has to be collected and paid on Rs.2 lakhs.
3. As in 2 above.
If your taxable service is rs. 10,20,000/-
then service tax will be charged on 10,20,000/-
Service tax registration
You need registration immediately after the turnover crosses 9 lakhs. Or if you starting a new business and sure about annual turnover will cross 10 lakh need to register with Superintend of central excise. You should register within 30 days of commencement of business.
i.e in case 1 , your turnover is cross 9 lakh, hence registratin is required.
in case 2 & 3 also you have to required registration
Querist : Anonymous
Just to tell you... we have already got our service tax registration.
Now, Like you say...
case 1 > no service tax ?
Case 2 > Service tax on full Second contact
of 5L or only on balance 2L (7+5-10) ?
case 3 > service tax on complete 12 L or
only 2L ? (its a single contract... single bill ... )
Querist : Anonymous
Thanks for the replies.
However, my basic question is,
in case 2 > 2nd contract > can we have 3 Lac billing without service tax & remaining 2 Lacs with service tax ?
Same question in 3rd case also > can we have 10 Lac billing without service tax & balance 2 lac with service tax ?
In fact, once the exemption is availed, the basic exemption limit of Rs. 10 lakh would continue. The assessee shall have to charge, collect and pay service tax on the amount invoiced after reaching the limit of Rs. 10 lakh. For example, the assessee has decided to opt for exemption scheme and in the mid of year, he finds that its turnover has exceeded Rs. 10 lakh. For the bills etc issued upto the stage of reaching Rs. 10 lakh limit for which he has already issued bills and collected proceeds without service tax, the exemption will be allowed. He should charge service tax on all subsequent bills issued against the services rendered and pay service tax accordingly on the bills so issued for the remaining part of the year. It would be advisable to make separate bills upto 10 lacs (exempt sale) and subsequently (taxable sale).
Same in 3rd case also You can have 10 Lac billing without service tax & balance 2 lac with service tax as service tax is to levied on receipts of Rs. 10 lakhs and not on the basis of contract.
All of you have provided solution in an excellent way.
Now the above discussion have gave birth to a new point.
In case Registration under Service Tax is done and gross turnover is below ten lakhs. Then assesse would e-file the Return or will skip?
If to file then it should be ZERO/NIL amount? OR Value of Receipt be mentioned?
Thanks!
ii) amount should be disclosed and exemption notification number should be filled in the respective columns of ST-3.
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