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Interest on late payment of service tax

Neha sharma (-) (1257 Points)

28 March 2013

What is the Interest to be paid on Late Payment of Service Tax?

Is it 18% or 15%?

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5 Replies

Deepak Gupta (CA Student) (15922 Points)
Replied 28 March 2013

Originally posted by : Neha sharma
	What is the Interest to be paid on Late Payment of Service Tax? Is it 18% or 15%?

Delay in payment of service tax liable for interest @ 18% p.a.

(Increased from 13% to 18% vide Notification No.15/2011-ST dated 1st March, 2011 w.e.f. 1st April, 2011)
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W.e.f. 8th April, 2011, where the service provider whose value of taxable services provided does not exceed Rs.60 Lacs during any of the financial years covered by the Notice u/s. 73A(3) or during the last preceding financial year, as the case may be, such rate of interest shall be reduced by 3% p.a. [Section 73B].

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Asif Khan (Taxation executive) (410 Points)
Replied 28 March 2013

Its 18% ,as per notification No. 14/2011-Service Tax dt. 01.03.2011 and 15/2011-Service Tax dated 01.03.2011 but there is an exception for Small Service providers, So the reduced interest rate of 15% (18%-3%) will be applicable in case where the value of taxable services provided in a financial year is not more that Rs. 60 lakh.