21 March 2012
my client is having jobwork business with turnover 35 lacs who doesn't fall in the limit mentioned in budget Rs. 50 lacs. should my client collect service tax in next FY.
21 March 2012
Service tax payable on receipt basis by all individual and partnership firms (including LLP) upto turnover of 50 lakhs w.e.f. 1-4-2012 Hence in your client case Service tax to be collected and to be paid on receipt basis up to the turnover of 50lakhs.
21 March 2012
@ Ravikumar,payment of ST on receipt basis depends on the turnover of previous year service turnover. If TO of PY is less than Rs.50 lacs, he can pay ST on receipt basis irrespective of TO of current year (eventhough TO is above 50 lacs). However, he has to shift to accrual basis in next year as current year TO exceed 50 lacs. So, your comment that St to be collected on receipt basis UPTO 50 lacs require correction.
21 March 2012
Dear Krishna Mohan, if the turnover in the PY is less than INR 50 lacs then the client has the option to discharge the liability to ST on receipt basis up to INR 50 lacs in the current year and on accrual basis thereafter. Mr Ravikumar is correct. relevant extracts of the Rule is reproduced below for clarity: "Provided also that in case of individuals and partnership firms whose aggregate value of taxable services provided from one or more premises is fifty lakh rupees or less in the previous financial year, the service provider shall have the option to pay tax on taxable services provided or to be provided by him up to a total of rupees fifty lakhs in the current financial year, by the dates specified in this sub-rule with respect to the month or quarter, as the case may be, in which payment is received.”,
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