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How to calculate ST ?

Sushant (Executive) (106 Points)

23 September 2010

I deal with Product A which I later Re-sell.

When I buy ProductA, I am charged with STT.

When I resell Product A , I collect STT also.

I need to pay service tax based on Collected - Paid ?

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5 Replies

Ankit Singla (B.Com (Hons.), CA) (88 Points)
Replied 23 September 2010

HI sushant

service tax is charged on services provided not on purchase and sale of products

On purchase and sales a matter of VAT arises which is to be paid after taking input credit of Vat paid on purchases done within state.

Thanks & Regards

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Sushant (Executive) (106 Points)
Replied 23 September 2010

A Correction : ProductA should be ServiceA.

Prachi Jindal (CA-Article-Final-Student) (129 Points)
Replied 26 September 2010

Originally posted by : Sushant
	A Correction : ProductA should be ServiceA.

in this case service tax paid at the time of receiving any service then tax credit will be available at the time of provision of output service. but if one has not charged with service tax at the time of receiving it then credit can not be claimed as no credit is available...not only of service tax....even if one has paid excise duty at the time of purchase of goods and he is providing output service then credit of excise paid at the time of purchasing the goods is available and service tax paid at the time of provision of service can be adjusted through it....and vice versa....

crux is that....

if paid on input then credit is available on output....if not then credit is not available.