remittance of service tax
Querist : Anonymous
wE MAY NOT BE COMING UNDER SERVICE TAX EVEN FOR THE NEXT YEAR.
PLEASE ADVICE
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Querist : Anonymous
Querist : Anonymous
Key Points:
Threshold for Service Tax Registration:
The threshold limit for service tax registration (back then) was Rs. 10 lakhs.
If your aggregate turnover is below Rs. 10 lakhs, you are not liable to pay service tax and should not have registered.
Collection of Service Tax without Registration:
If service tax was collected from clients despite not being liable, this amount is not your income.
You cannot keep this amount as it is a tax collected on behalf of the government.
Refund to Clients:
Ideally, you should refund the collected service tax to your clients, since you are not liable to pay it to the government.
Alternatively, if refund is difficult, you must deposit the collected tax with the service tax department as per law.
Non-Payment to Service Tax Department:
You cannot adjust or withhold payment of service tax collected from clients just because you feel you are not liable.
Non-payment of collected service tax can lead to penalties, interest, and legal issues.
Recommended Steps:
Refund the Rs. 50,000 service tax collected to your clients.
If refund is not possible, pay the collected service tax to the service tax department.
Submit an application for cancellation of service tax registration since your turnover is below the threshold.
Maintain clear records of the refunds or payments made.
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