My brother has a shop given on rent and since his rent income was going to cross Rs.10 lakhs in August 2012, we had file for Service Tax Registration and received the certificate.
We did not collect any Service Tax from the tenant (business) from April to July 2012 when the amount had not crossed Rs. 10 lakhs limit. We started collecting Service Tax from the tenant August 2012 onwards and paid the Service Tax to the government for August and September at the end of that quarter. We have been waiting to file the first service tax return and finally the new ST-3 has been released.
We downloaded the newly released form ST-3 for the quarterly return from 1st July to 30th September 2012 from this link -
We have selected "Proprietorship / Individual" option in the 'Constitution' field 'A8' and "Renting of Immovable Properties" under field 'A9' for 'Taxable Service for which Tax is being paid'. Accordingly, the Excel utility automatically adds other sheets to the file.
We wanted to avail the one-time Rs.10 lakhs exemption but the dropdown list in this ST-3 Excel form does not have the Notification 06/2005 option at all. The Notification dropdown list only has these fixed options -
Has the notification number for Rs.10 lakhs one-time exemption changed?
Should I not include the exempted amount in the Gross Value field B1.1 and just put the amount beyond Rs. 10 Lakhs?
What is the correct way to proceed forward in the above scenario?
I hope you have downloaded and seen the notification options to understand the above scenario (as they may be different for someone selecting other options in A8 and A9).
A related question... since we had filed for Service Tax Registration in July 2012 and then started collecting Service Tax from the Tenant from August 2012, what should be the amount I should enter for field B1.1 Gross Amount and B1.9 for the Exemption amount?
Option 1: If Rent from April to September 2012 of 12 lakhs is shown in field B1.1 for Gross Amount then Exemption of 10 lakhs can be shown in field B1.9 and then taxable value is correctly shown as 2 Lakhs and we have collected Service Tax on the same and paid the same.
Option 2: But technically, value for both fields should be for the period from July to September 2012 only. So if I enter 4 lakhs in B1.1 Gross Amount and 2 lakhs for B1.9 Exemption, then taxable value will be 2 lakhs. But if we do that then that may be misleading as how do I show the previous quarter's rent and exemption?
I wonder if someone is going to say that we should have filed a separate return for April to June 2012 for Gross Amount and then full amount as Exemption for that quarter? But then we did not even apply and have a registration number until July/August 2012. Why should we file a return for April to June 2012?
Had it been a half-yearly return like earlier, then this complication would not have arisen. But now this complex dilema due to Quarterly returns. Still, even with half-yearly returns if someone's taxable service income exceeded 9/10 lakhs only in the second half of the year, then they too would have faced the same issue about how to show the Gross Amount and Exemption.
We feel Option 1 is practical but we wanted to check Expert opinion about what others were doing, what's the best practice?
Today the New ST3 Return format for Jul-Sep12 released.
When I tried to fill the data, I faced a error. i.e., "Rent a Cab" service selected in this return, there is no option of 40% (under abated value) for service receiptant, only showing 60%.
secondly "MAN POWER SUPPLY" selected, I could not understand that format. where I have to fill, what is the gross amount B2.1, I filled 100% of service value in this column, (B2.7) is showing "amount on which ST payable under RCM" ? I filled 75% value. But it is clubbing thease filgures. Kindly give advise on this?
Service Tax Consultant Rourkela ServiceTaxExpert@yahoo.com
The provisions contained in the Act has more legal force than the statutory forms issued by CBEC under the Act. The forms must confirm to the provisions in the Act and Rules made thereunder. So you need not worry about disclosure as you are not hiding anything. You mention the numbers pertaining to the 2nd Quarter and claim the correct exemption available to you Rs. 10 Lacs by mentioning the notification no. 33/2012 which is automatic unless you forego. The exemption is calculated from the 1st Invoice issued during the financial year, but you were not liable to take registration during the 1st quarter as your gross receipt was less than Rs. 9 lacs. So you need not file return for 1st quarter.