Basis of payment of service tax
This query is : Resolved
MAHAVEER CHAND
(Querist)
20 February 2016
Either Receipt basis or
Biling Basis
Biling Basis
Suresh Ramaswamy
(Expert)
20 February 2016
Under Point of Taxation Rules the liability for service tax (excluding tax payable under Reverse Charge Mechanism) is on the happening of one of the three following events:
(a) Completion of the Service Rendered.
(b) Issue of Tax Invoice - if the invoice is issued within 30 days of completion of service, the date of invoice will be treated as date of service rendered, - else it will be the date of completion of service rendered.
(c) Receipt of the consideration in cash or otherwise.
- whichever is earliest.
Therefore the Service Tax Liability arises on the issue of invoice (subject to (b) above) irrespective of whether the amount is received or not.
(a) Completion of the Service Rendered.
(b) Issue of Tax Invoice - if the invoice is issued within 30 days of completion of service, the date of invoice will be treated as date of service rendered, - else it will be the date of completion of service rendered.
(c) Receipt of the consideration in cash or otherwise.
- whichever is earliest.
Therefore the Service Tax Liability arises on the issue of invoice (subject to (b) above) irrespective of whether the amount is received or not.
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