Refund service tax interest rate

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 September 2013 What is current service tax interest rate in case of claiming refund of input service tax paid on input services and assessee is an exporter of services?

Arun Kumar Singh

Arun Kumar Singh (Expert)
Follow

20 September 2013 interest on service tax @ 18% per annum.

Querist : Anonymous

Querist : Anonymous (Querist)

23 September 2013 I HAVE ASKED WHAT RATE SERVICE TAX DEPT WILL PAY US NOT WE HAVE TO PAY TO SERVICE TAX DEPT.

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
Follow

20 July 2025 Got it! You want to know the interest rate the Service Tax Department pays on delayed refund of input service tax (especially for exporters), right?

As per Section 11B of the Central Excise Act (which covers Service Tax too):

The department pays interest at 6% per annum on the refund amount if the refund is not granted within 3 months from the date of receipt of the claim.
The interest is calculated from the date of the claim to the date of refund.
However, the rate may vary if there are notifications or amendments.
So, interest paid by the department on delayed refunds is 6% p.a., not 18%.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now