Minimum limit

This query is : Resolved

Santosh (Querist)
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25 April 2012 Dear Sir,
One of our client is regd under service tax 8years back, when the Minimum Limit of Taxable service to charge service tax is Rs.4 Lacs was in force and they have exceeded the said limit so they have taken the regn.

Now by various notification from time to time the said limit has been increased to 10lacs.

My query is that whether they should charge service tax now. As they are within the limit of 10 lacs since last 3 Fin. Years.

Please provide us the relevant section for your answers.

CA Dileep Surya Kumar

CA Dileep Surya Kumar (Expert)
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25 April 2012 Small service providers whose total value of services provided (including exempt and non-taxable services) is less than Rs 10 lakhs in previous year are not required to pay service tax in current financial year till they reach turnover of Rs 10 lakhs. Registration is required if turnover exceeds Rs 9 lakhs per annum.(Notification No 8/2008-ST dated 1.3.2008)

In your case, last year gross receipts less than 10 lakhs,hence you need not charge service tax upto 10 lakhs for the current financial year.