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Ssp threshold limit unique

PRADEEP MULANI (Partner in MULANI BHANSARI & SHAH ) (142 Points)

20 December 2011

Basic Exemption Limit for SMALL SERVICE PROVIDER

Before 01/04/2005 No Limit

01/04/2005 to 31/03/2007 Rs.4 Lakhs

01/04/2007 to 31/03/2008 Rs.8 Lakhs

01/04/2008 to Till Date Rs.10 Lakhs

Now the Query is...

If during Financial Year 2006-07 the Total Service Provided by Person is Rs 6 Lakhs, as a result therof he shall be liable to Register & Pay Service Tax on Rs.2 Lakhs.

The question is whether shall he be eligible to take the status of Small Service Provider in the Financial Year 2007-08 as the limit has been increased to Rs.8 Lakhs?

Awaiting your valuable Replies...

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2 Replies

CA Prabhat Gupta (Manager (Indirect Taxes)) (821 Points)
Replied 20 December 2011

Mr. Pradeep,

In my opinion, if we go through the language of amendment notification & Notification 6/2005, condition for availment of benefits of Threshold require that gross amount of preceeding year should not exceed an amount equal to the threshold limit. These limits get changes simultaneously on amendment notification. Hence the enhanced limit should be considered for computing gross turnover of preceeding year.