Service tax paid w/o reaching rs.10lakhs-can refund be claim
This query is : Resolved
14 December 2013
Hi,
I would appreciate if someone could guide me with respect to Service tax refund.
Can one claim service tax refund if it is charged without reaching the threshold exemption limit of Rs.10 Lakhs. This was done erroneously expecting the turnover to exceed Rs.10 Lakhs in the financial year. But now the Income (Professional Fees) will not cross the threshold limit of Rs.10 Lakhs. Last year also this threshold limit was not crossed.
1. Can we claim refund from the authorities for this amount erroneously paid ? And how ?
2.Can we still claim refund from the authorities for this amount erroneously paid if the service receiver has claimed Input credit for the same?
Thanks,
Kind regards,
Anita
I would appreciate if someone could guide me with respect to Service tax refund.
Can one claim service tax refund if it is charged without reaching the threshold exemption limit of Rs.10 Lakhs. This was done erroneously expecting the turnover to exceed Rs.10 Lakhs in the financial year. But now the Income (Professional Fees) will not cross the threshold limit of Rs.10 Lakhs. Last year also this threshold limit was not crossed.
1. Can we claim refund from the authorities for this amount erroneously paid ? And how ?
2.Can we still claim refund from the authorities for this amount erroneously paid if the service receiver has claimed Input credit for the same?
Thanks,
Kind regards,
Anita
14 December 2013
Dear Ma'am,
As per the Provisions of Finance Act and Service Tax Rules, whatever amount has been collected from the customers towards Service Tax has to be deposited with Revenue irrespective of whether you were liable to collect or not..
In your case, it seems that you have charged Service Tax separately in your bills and collected accordingly.. Even though this amount has been paid erroneously to the revenue, the amount being collected in the nature of Taxes has to be deposited with revenue..
Had Service tax not separately charged in bills there could have been the possibility to take back the refund..
In any case the amount has been collected from customers in addition to the charges(fees) hence paying it to revenue will not affect the financial position of your company.
Whether customer has taken CENVAT credit or not is out of question...
As per the Provisions of Finance Act and Service Tax Rules, whatever amount has been collected from the customers towards Service Tax has to be deposited with Revenue irrespective of whether you were liable to collect or not..
In your case, it seems that you have charged Service Tax separately in your bills and collected accordingly.. Even though this amount has been paid erroneously to the revenue, the amount being collected in the nature of Taxes has to be deposited with revenue..
Had Service tax not separately charged in bills there could have been the possibility to take back the refund..
In any case the amount has been collected from customers in addition to the charges(fees) hence paying it to revenue will not affect the financial position of your company.
Whether customer has taken CENVAT credit or not is out of question...
14 December 2013
Dear Anita Ji
As per my view refund is not possible.
Firstly,as per notification No. 33/2012 regarding exemption to small service provider,its says once a service provider opts to pay tax even if his turnover is less than 10 lakhs,he cannot change his option.He has to pay service tax.
Secondly,as the service receiver has already availed the cenvat credit ,refund of service tax cannot be claimed .
As per my view refund is not possible.
Firstly,as per notification No. 33/2012 regarding exemption to small service provider,its says once a service provider opts to pay tax even if his turnover is less than 10 lakhs,he cannot change his option.He has to pay service tax.
Secondly,as the service receiver has already availed the cenvat credit ,refund of service tax cannot be claimed .
15 December 2013
Thank you Ms. Annu and Mr. Shriram. Please refer the comments with further questions.
15 December 2013
Thank you for prompt response and the clarification Ms. Annu Agarwal & Mr. Shriram Gupta.
I have three more questions in this case then.
1. Can we now surrender the Service tax registration in the middle of the year ? We have already filed the return for the first 2 quarters on 7th October 2013.
2. In case we do not surrender the registration this year do we still have to file a return on or before 7th April 2014 ?
3. In case we do not surrender the registration can we claim the Rs.10 Lakhs exemption next year as it was not claimed this year or is it once in a life time thing or will it be disallowed cause we did not avail it this year and started collecting and paying service tax.
Please clarify the above.
Kind regards,
Anita
Best regards,
Anita
I have three more questions in this case then.
1. Can we now surrender the Service tax registration in the middle of the year ? We have already filed the return for the first 2 quarters on 7th October 2013.
2. In case we do not surrender the registration this year do we still have to file a return on or before 7th April 2014 ?
3. In case we do not surrender the registration can we claim the Rs.10 Lakhs exemption next year as it was not claimed this year or is it once in a life time thing or will it be disallowed cause we did not avail it this year and started collecting and paying service tax.
Please clarify the above.
Kind regards,
Anita
Best regards,
Anita
15 December 2013
Anitaji,
Reply to your questions:
1. Yes you can surrender the registration certificate at any time during the previous year.. But note before surrendering the RC, you shall file all the returns till the period of surrender..
2. Yes.. if RC is not surrendered then the return for the period pertaining to half year ending March 2014....
3. Small scale exemption is not once in life time.. It can be claimed every year but once claimed, it will have to be continued for the year.. Even if not claimed in any particular year, it can be claimed in next year.. but don't forget to mark in returns to be filed...
I hope your queries have been resolved...
Reply to your questions:
1. Yes you can surrender the registration certificate at any time during the previous year.. But note before surrendering the RC, you shall file all the returns till the period of surrender..
2. Yes.. if RC is not surrendered then the return for the period pertaining to half year ending March 2014....
3. Small scale exemption is not once in life time.. It can be claimed every year but once claimed, it will have to be continued for the year.. Even if not claimed in any particular year, it can be claimed in next year.. but don't forget to mark in returns to be filed...
I hope your queries have been resolved...
15 December 2013
Yes thank you Mr. Shriram all my doubts have been cleared now.
Thank you for your time.
Kindest regards,
Anita
Thank you for your time.
Kindest regards,
Anita
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