Service tax liability

Page no : 2

Dhiraj (Article) (33 Points)
Replied 24 June 2011

In this regard we must see

1.When the threshold limit of Rs 10 lacs is crossed and

2.When SP is actually liable to pay service tax

In calculating 10 lacs limit we consider only current year service value ( without adding S Tax) , prev year value is not considered.

However SSP is required to pay Stax in c year once 10 lacs crosssed in C.Year and receipts in excess of Rs 10 lacs in CY . Receipt may be of CY or PY ,it doesnot matter.

As far i think motive of legislator is to give exemption to SSP only once in his life time and annually. And there is not any provision or rules which give SSP not to pay tax on exemption year service value if he doesnt receive value in that period itself..

please let me know if i m wrong

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CA ADITYA SHARMA (CA IN PRACTICE ) (16719 Points)
Replied 24 June 2011

Originally posted by : TusharSSampatM.Com CA,CS-FINAL
	For registration d threshold limit mentioned is Rs 9,00,000 and for payment of ST the threshold limit is Rs 10,00,000 n once it crosses this then for evry taxable services provided that person is liable to pay St. In your case i think still it has not touched rs 10,00,000 so no ST is to be paid. Registration n Liabilty to pay ST has no direct connection in my view. Views of other members are also welcomed . Correct me if i am wrong.

agreed

salman shamsi (PRACTICING CA) (107 Points)
Replied 28 June 2011

i want to ask if any company has taken registration before crosing 10 lakhs and charges service tax on some of its bill which he has collected also and on other bills he does not charge service tax.

now question arises that the company has not crossed 10 lakhs even though it has collected service tax on some of its bills while on other bills it has not collected,what should be the tax liability:

(a)it should pay tax equal to collected (say on 200000 lakhs it has collected 20000+3%)

(b)
on total turn over say six lakhs