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Maintenance of Records under Service Tax

srikanth 
on 06 March 2012

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With the blessings of the God and my Gurus and inspiration from Bosses, Colleagues and my family members I am writing and posting this first article.

Service tax assesses are governed by the provisions of the Finance Act, 1994, according to this service tax assesses are required to comply with the various provisions and rules.

Here an attempt has been made to be familiar with the records required to be maintained for the purpose of service tax.

RULE 5 OF SERVICE TAX RULES, 1994

As per the provisions of Rule 5 of Service Tax Rules, 1994, following are the records to be maintained for the purpose of service tax:

1. Records including the computerised data as maintained by an assessee as per the various laws in force from time to time.

2. Every assessee has to furnish the list of records maintained by him at the time of filing of first service tax returns to the Jurisdictional Superintendent concerned, as under:

a. All the records prepared or maintained to record accounting transactions.

b. All other financial records maintained in the normal course of business.

2. The above said all such records shall be preserved at least for a period of five years.

3. The above said records should be maintained at the registered premises.

ALL THE RECORDS

All the records would be the records maintained for recording the accounting as well as financial transactions. Recording of accounting transactions would be for the below:

a) Providing of any taxable service.

b) Providing of any exempted service.

c) Receipt of input services.

d) Procurement or Purchase of input services.

e) Payment for such input services.

f) Receipt of inputs or capital goods.

g)  Purchase of inputs or capital goods.

h) Manufacture of inputs or capital goods.

i) Storage of inputs or capital goods.

j)  Sale or delivery of inputs and capital goods;

k) Other activities.

FOLLOWING ARE THE SUGGESTED RECORDS

Based on the services provided by the assessee, following are the suggested records to be maintained exclusively for recording service tax transactions:

I. Bill register.

II. Receipt register.

III. Service Tax Master File.

IV. Debit / credit Notes Register.

V. Reimbursement of expenses Record.

VI.CENVAT Credit Register or Statement – For recording.

a. Availment,

b. Utilization.

c. Opening and Closing Balances of the Cenvat Credit.

VII. Service tax related documents for the following:

a. Agreements entered with the clients.

b. Copies of bills raised on clients.

c. Receipts issued to the clients.

d. GAR-7 Challans relating to service tax.

e. Other documents relevant for service tax.

i. Register or document for the visits by the Department.

ii. Correspondences with the Department and

iii. Acknowledgment of documents submitted to the Department.

iv. Other documents as organization requires from time to time.

CONCLUSION

Service tax assesses should maintain the above said files, documents, records and the it has to be intimated to the service tax department at the time of first time of filing of service tax (ST-3) returns and the same should be acknowledged.

QUESTION AND ANSWERS

Which provision deals with the maintenance of records for the service tax purpose?

Rule 5 of Service Tax Rules, 1994, deals with the records required to be maintained for the purpose of service tax.

What are the records required to be maintained for the purpose of service tax?

All the records maintained by the assessee for recording of accounting or financial transactions pertaining to service tax, besides the below:

i. Agreements entered with the clients.

ii. Copies of bills raised on clients.

iii. Receipts issued to the clients.

iv.GAR-7 Challans relating to service tax.

v. CENVAT Credit Register or Statement.

vi. Other documents relevant for service tax.

vii. Correspondences with the Department.

viii. Visits by the Department – Register at security place or Register maintained by the accounts department – stating or containing the below:

a. Name.

b. Designation.

c. Purpose.

d. Signature.

e. Other details as per the organization’s requirement.

ix. Acknowledgment of documents submitted to the Department.

Are there any specific records required to be maintained for the purpose of service tax?

There were no specific records to be maintained for the purpose of service tax, the following would be sufficient:

a. Records prepared or maintained by the assessee for recording of all the accounting transactions;

b. All other financial records maintained by the assessee in the normal course of business.

At which premises records have to be maintained?

Assessee should maintain all the above said records at the service tax registered premises.

What is meant by the registered premises?

Here, the registered premises means all premises or offices from where an assessee is providing taxable services.

For how many years or periods the records should be preserved?

According to the Rule 5 of the Service Tax Rules, 1994, all the above said records shall be preserved at least up to the period of five years immediately after the financial year.

What does service tax assessee require to do?

Assessee at the time of filing of first service tax returns should furnish or intimate a list of all records maintained by him for recording all the transactions pertaining to normal course of business to the Jurisdictional Superintendent concerned.

QUOTE FOR THE DAY

“The great secret of true success, true happiness is – the man or woman who asks for no return - The perfectly unselfish person, is the most successful.” Swami Vivekananda

Thank you

Source: Finance Act, 1994

Ramakrishna Math - Swami Vivekananda Quotation

By Srikanth Manne




Category Service Tax
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