31 October 2014
For Chartered Accountants Services. (Assume)As on 01/07/2011, my receivable is Rs.30 Lacs and out of that Rs. 18 Lacs is Bad Debt. as per Income Tax, we maintain our accounts as per Receipt Basis, so as per Income Tax, question of Tax doesnt arise. but as per Service tax , we need to pay Service tax on Accrual Basis. My question is: (a) Whether i need to pay Service Tax on Full amount i.e. Rs. 30 Lacs or Rs. 12 Lacs(Which is actually received. (b) Should i ignore Rs. 18 Lacs (Bad Debt) or need to Pay ST on it also.
31 October 2014
I presume that the chartered accountant service you are talking about is carried either through Individual CA as Individual or through a group of Chartered Accountants as a partnership firm. As per proviso to Rule 6(1) in case of individuals or a partnership firm whose agrregate value of taxable services is 50 lakhs or less in the previous financial year,shall have option to pay service tax by the dates specified in this rule with respect to the month or quater in which PAYMENT IS RECEIVED. (a) If you fall in above category then you need to pay service tax on 12laks which is actually received. (b)As 18 lacs is not received by you even after reasonale efforts,you can writeoff the same without paying any tax.
CAclubindia
