CA Prabhat Gupta
(Manager (Indirect Taxes))
(821 Points)
Replied 29 December 2011
Where you have not shown the Service tazx amount separately on the receipt issued by you to the customer servicetax liability would be as follows:
Normal rate of service tax = 10%
Rate net of abatement = 5%
Net rate including EC & SHEC = 5.15%
Service Tax calculation:
= Gross amount received x Rate of tax / (100 + Rate of Tax)
In your case as total receipt is Rs.29500/- (inclusive of ST) the calculation will be as follows:
= Rs. 29500 X 5.15 / (105.15)
= Rs.1445/-
MADHUSUDAN THAKUR
(Student)
(26 Points)
Replied 29 December 2011
Sir, if i received room rent Rs.2500 and a abatement notification of 50% is available then plz tell me the amount of ST
MADHUSUDAN THAKUR
(Student)
(26 Points)
Replied 29 December 2011
Or is it correct if i devide the gross amount received and then calculate ST. i.e. 29500/2= 14750
and 14750*10.3/110.3 ..???
CA Prabhat Gupta
(Manager (Indirect Taxes))
(821 Points)
Replied 29 December 2011
No, as amount received by you is inclusive of Service Tax, the procedure followed by you is incorrect. Abatement is given on Assessable value that is net of tax. where you are deducting abatement from amount of receipt inclusive of service tax you are availing abatement on service tax amount also, that is incorrect.
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