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Service tax questions

Ashok (Others) (32 Points)

29 October 2014

Hi to all, i have feq questions related to service tax. Please help me with this.

1. I am running a small design company in bangalore and my client is a US company. I receive payments in USD to my paypal and from there i withdraw to my bank account? Do i need to pay Service Tax? I have been paying service tax for the past 1 year based on the suggesstions from an auditor. But another auditor told me that i don't need to pay Service tax. I am quite confused.

2. Every month i calculate and make service tax payment by myself. Every six month, i send all the receipts to Auditor and he will e-file them. He is charging me Rs.2,500 for E-Filing. Am i paying a lot? How much do you charge for E-Filing (just e-filing). Note that, i don't do any consulting from him. He is just for Service tax purpose.

Thank you

Ashok

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11 Replies

Vinay Garg (Service Tax Expert) (775 Points)
Replied 29 October 2014

Dear Mr. Ashok

Please provide us some more details about the design work your company does.

and let us know whether your client from USA pay you in $ or in INR ?

Ashok (Others) (32 Points)
Replied 29 October 2014

Originally posted by : Vinay Garg
	Dear Mr. Ashok Please provide us some more details about the design work your company does. and let us know whether your client from USA pay you in $ or in INR ?

Hi,

I do web designs and send them to my client in US. Yeah, he pay me in USD to my Paypal Account. While withdrawing paypal convert the USD to INR and deposit it to my bank account.

And also can you please provide me the info about Service Tax E-Filing fee?

Thank you

Vinay Garg (Service Tax Expert) (775 Points)
Replied 29 October 2014

Originally posted by : Ashok
	I am running a small design company in bangalore and my client is a US company. I receive payments in USD to my paypal and from there i withdraw to my bank account? Do i need to pay Service Tax?

Dear Sir,

As per Rule 6A of Service Tax Rules, 1994, provision of any service provided or agreed to be provided shall be treaed as Export of Service if following conditions are satisfied:-

1. The provider of taxable service is located in taxable territory.

2. the recepient of service is located outside india.

3. the service is not a service specified in the negative list [Section 66D].

4. the place of provision of the service is outside india.

5. the payment for such service has been received by the provider of service in convertible foreign exchange.

As per my view, In your case all the above conditions are satisfied. Hence, it will be covered under export of service and you are not liable to pay service tax.

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Ashok (Others) (32 Points)
Replied 29 October 2014

Thanks for your reply. Do I get refund for all service tax payments I made? It will exceed more than 3 lacs... Thank you

Vinay Garg (Service Tax Expert) (775 Points)
Replied 29 October 2014

Originally posted by : Ashok
	Every month i calculate and make service tax payment by myself. Every six month, i send all the receipts to Auditor and he will e-file them. He is charging me Rs.2,500 for E-Filing. Am i paying a lot? How much do you charge for E-Filing (just e-filing). Note that, i don't do any consulting from him. He is just for Service tax purpose. Thank you Ashok

Dear Mr. Ashok

Fee charged by CAs may vary with location.

So, we can't guide you for that.

You may ask another CA in your locality for the charges.

Ashok (Others) (32 Points)
Replied 30 October 2014

Originally posted by : Vinay Garg
	Originally posted by : Ashok Every month i calculate and make service tax payment by myself. Every six month, i send all the receipts to Auditor and he will e-file them. He is charging me Rs.2,500 for E-Filing. Am i paying a lot? How much do you charge for E-Filing (just e-filing). Note that, i don't do any consulting from him. He is just for Service tax purpose. Thank you Ashok Dear Mr. Ashok Fee charged by CAs may vary with location. So, we can't guide you for that. You may ask another CA in your locality for the charges.

Thanks for the info. Is it possible to get refund of the service tax?

Vinay Garg (Service Tax Expert) (775 Points)
Replied 30 October 2014

Yes. as far as i remember

Refund can be claimed under sec.11B of Central Excise Act, 1944 for ONE YEAR.in your case.

You should contact a CA in your locality for more information.

Ashok (Others) (32 Points)
Replied 30 October 2014

Originally posted by : Vinay Garg
	Yes. as far as i remember Refund can be claimed under sec.11B of Central Excise Act, 1944 for ONE YEAR.in your case. You should contact a CA in your locality for more information.

Thank you very much.

Vinay Garg (Service Tax Expert) (775 Points)
Replied 30 October 2014

You are welcome Mr.Ashok

vaibhav (Student CA Final ) (65 Points)
Replied 31 October 2014

I HAVE GOT MY SERVICE TAX REGISTRATION DONE IN SEPTEMBER,2014 BUT THE LIABILITY ARISE IN P/Y 2013-14, CAN I FILE SERVICE TAX RETURN OF THAT PREVIOUS YEAR NOW EVEN THOUGH MY REGISTRATION IS OF CURRENT YEAR?

Vinay Garg (Service Tax Expert) (775 Points)
Replied 31 October 2014

Originally posted by : vaibhav
	I HAVE GOT MY SERVICE TAX REGISTRATION DONE IN SEPTEMBER,2014 BUT THE LIABILITY ARISE IN P/Y 2013-14, CAN I FILE SERVICE TAX RETURN OF THAT PREVIOUS YEAR NOW EVEN THOUGH MY REGISTRATION IS OF CURRENT YEAR?

Dear Mr. Vaibhav,

Yes, you should file service tax return of PY alongwith penalities and interest. You shall pay

the simple interest u/s 75 at the rate of 18% p.a. for late payment of service tax. But in case your value of taxable service did not exceed Rs. 60 Lakhs during any of the last or current financial year, then interest rate will be 15% p.a. for you.
Penality under Rule 7C of Service Tax Rules 1994 for late filing of return
- Rs.1000/- + Rs.100 for everyday from the 31st day till date of furnishing of return (subject to maximum of Rs.20000/-)

You may also attract Penality u/s 77 for delay in taking registration which may amounts upto Rs. 10,000/-

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