18 May 2009
A Company charges service tax on the services provided. Service tax is paid to the govt as and when realised from the customers. At the end of the year, Company allows discount to customers based upon the quantum of annual business conducted with them, as applicable. Will the service tax component on the amount allowed as discount be also be reversed, as this amount will also not be realized from the customers?
19 May 2009
Billed amount has been recovered in some cases, and the discount allowed will be adjusted against the balance amount receivable. The discount is allowed if turnover crosses a particular limit and calculated bill-wise.
20 May 2009
ST is payable only on receipt. Therefore is a discount is given at a later point of time and subsequent payments are recived short then ST on those subsequent payments recived would be lower. ( discount cannot be added on tpo the receipts)