Koushal Mantri (Practice) (28 Points)
04 September 2013What will be the service tax applicability in the following case??
Year 1, service rendered for Rs.800000
Year 2, service rendered for Rs. 1200000
Year 3, service rendered for Rs. 700000
Year 4, service rendered for Rs. 600000
Can the service provider take benefit of small service provider exemption again in the year 4?
shikhar
(LEARNER )
(1394 Points)
Replied 04 September 2013
HELLO..... FRIEND.
UNTIL U DONT CROSS THE LIMIT OF 10 LAKH , SERVICE TAX IS NOT APPLICABLE.
1st YEAR- NO TAX LIABILITY
2nd YEAR- (1200000- 1000000)= 2LAKH , u r liable to pay service tax on 2 lakh.
3rd YEAR- LIABLE TO PAY SERVICE TAX ON 7 LAKH
4th YEAR- LIABLE TO PAY SERVICE TAX ON 6 LAKH
ONCE U CROSS THE LIMIT OF 10 LAKH SERVICE TAX WILL BE APPLICABLE & DEDUCTION FOR 10 LAKH WILL BE AVAIL ONLY ONCE.
THANK YOU
SHIKHAR
Koushal Mantri
(Practice)
(28 Points)
Replied 04 September 2013
Hi friend.
Thank you for your reply.
But can you please provide me link for the same,
since in the Notification No. 33/2012 - Service TaxNotification No. 33/2012 - Service Tax
it is written that the aggregate value of taxable services rendered by a provider of taxable service, does not exceed ten lakh rupees in the PRECEDING FINANCIAL YEAR is elegible to benefit from the the said exemption and nowhere it is written that the small service provider exemption is a onetime exemption, as you said
So could you please help me with the same??
Thank You
Koushal Mantri
R.Parasuraman
(CA final)
(187 Points)
Replied 04 September 2013
Here it is to be mentioned that, Exemption provided as per Notification-33/2012 is not Basic Exemption limit as available in Income tax act. Notification-33/2012 has been issued to provide benefits to New service provider who in turn will be a small service period untill they are not crossing Rs.10,00,000.
The intent of law makers should be considered while reading through Rules , Notification , Provisions.
Once The Service Provider Crosses Rs.10,00,000 of taxable services the person will cease to be Small Service provider consequently Notification 33/2012 will be not applicable.
However when Service provider not opt for Exemption under 33/2012 during any financial year and taxable services provided in that year does not exceed 10,00,000 then the benefit 33/2012 shall apply even if he has not opted for it in any of the preceding financial year. Hence the service provider has the option to avail exemption with respect to each financial year , he cannot be denied of mere fact of non availment of Exemption in any earlier financial year.
From the above Discussion we can summarize following
Small Service provider - Person who has not crossed taxable turnover of RS.10,00,000.
Small service provider has two options
Option 1 . Can avail benefit of notification no : 33/2012.
Option 2. Can charge Service Tax and claim eligible cenvat credit
The option is with respect to whole of the financial year
The benefit of Notification 33/2012 shall not be denied of mere fact that in any previous financial year the person has not availed the benefit.
Koushal Mantri
(Practice)
(28 Points)
Replied 07 September 2013
R. Parasuraman,
Thank You for your reply
so finally according to your reply the answer to my earlier example should be
Year 1: no tax since less than 1000000 (i.e. 800000)
Year 2: tax on 200000 (i.e. 1200000-1000000)
Year 3: tax on whole 700000, since in the previous financial year it was more than 1000000
Year 4: again no tax liability since the previous financial year it was less than 1000000 i.e. 700000 and also current year i.e 600000.
Ryt??
Please rply.
Thank you
Vishal Seth
(Udaipur)
(22 Points)
Replied 18 December 2013
One of my Friend is Register in service tax in Work Contract Service & Business Auxlary Servises.
He get a Contract of ADHAR Card from a Contractor. in this refrence my Question is-
1. can he get exemption of negative list service. (Service provided to Govt.)
2. can he get exemtion of WCT. if yes Plz Discribe the provission.
3. can he get exemtion of small service provider, if he recieved Advance of Rs 240000 in feb 2013 (F.Y. 2012-13) & Rs. 1200000 in May 2013 (F.Y. 2013-14)
A part of total service Complited In April 2013 and Bill of Rs 1400000 issued on 02.05.2013.
Plz give me Suitable sugation for service tax planning for said Friend.
Neljo Davis ACA
(Consultant)
(630 Points)
Replied 20 December 2013
Ans 1. Services provided by Government or local authority are in the negative list. Services provided to government are not covered.
Ans 2. "Works contract" means a contract wherein transfer of property in goods involved in the execution of a contract. There is no exemption for works contract. Only thing is determination of value of service portion is different. Notification no. 24/2012-ST, dated 6-6-2012. If transfer of property in goods is incidental to the main service, then service will not fall under the works contract service.
Ans 3. Notification no. 33/2012-ST, dated 20-6-2012 exempts aggregate value of taxable service not exceeding Rs.10 lakhs in any financial year from the whole of the service tax leviable thereon under section 66B of the Finance Act. The Friend can avail exemption for Rs.2, 40,000/- for the F Y 2012-13 and for Rs.10,00,000/- in F Y 2013-14.
Kunal Verma
(Accountant)
(83 Points)
Replied 03 January 2014
Is the Assessee required to register for availing the exemption of Rs. 1000000/- or
The Assesse is exempted to register for the service tax number if he is not providing service more than Rs. 10 Lakhs.
and if the assessee have to register for the service tax number, then how will he take the exemption that means how will he show the exemption in the st-3 return as online st-3 utility has not covered the notification no. 33/2012-st in it????
CHANDRA SHEKHAR BHANDARI
(Manager)
(22 Points)
Replied 04 January 2014
Plz also suggest if an assesse paying service tax on it's turnover but subsequently his tourover reduced to the limit of Rs. 10.00 Lacs.
In this situation should service tax charge or not ?
Koushal Mantri
(Practice)
(28 Points)
Replied 13 February 2015
Anil Kumar
(Proprietor)
(107 Points)
Replied 20 February 2015
Hi All,
Is Service Tax applicable for proprietor if:
Sale Invoice (Business Income) raised is Rs. 8,98,000
Freelance (Business) Income (invoice not raised) is Rs. 2,60,000
Thanks
chakradhar chowdary
(ARTICAL ASSISTENT)
(1 Points)
Replied 21 November 2015
Sir
my py trunover is 9 lakshs and cy trunover is 11 lakshs but a bill of 2 lakshs in current year lead trunover from 9 lakshs to 11 lkashas .this 2 laksh bill icluded both ssp expemption and taxable service how to show in serrvice tax bill
please respond quickly
CAclubindia
