requirement of filing return?

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puneet mohan (Querist)

15 March 2010 whether requirement of filing service tax return FOR THE FIRST TIME is on accrual basis or receipt basis.

For eg.
In all FY before 8-9 receipt is lower than 9,00,000.

In FY 8-9
commission accrued : 10,50,000/-
commission received : 6,00,000/-

Is registration or filing return compulsory for the FY 8-9

CA Gangadhar Mishra

CA Gangadhar Mishra (Expert)

15 March 2010 Service tax is applicable based on Gross services rendered > 10 lacs, but ST is to be paid on receipt basis. but for the applicability of the ST Act, it is accrual basis.

puneet mohan

puneet mohan (Querist)

19 March 2010 thank you sir

also specify whether in the above case service tax registration is compulsory.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

21 July 2025 Here’s a clear explanation for your question about service tax return filing and registration regarding accrual vs receipt basis:

1. When is Service Tax Registration Required?
Service tax registration is mandatory if the value of taxable services provided exceeds ₹10 lakhs in a financial year.

For determining threshold for registration, the basis is accrual (i.e., when the service is billed or earned), not receipt.

So, in your example for FY 8-9:

Commission accrued = ₹10,50,000 (above ₹10 lakh threshold)

Commission received = ₹6,00,000

Since accrued commission exceeds ₹10 lakh, registration for service tax is compulsory for FY 8-9, even if actual receipt is less.

2. Basis for Payment of Service Tax
Though registration threshold is on accrual basis, service tax payment is generally on receipt basis (when payment is actually received).

You must pay service tax on the amount actually received during the period.

3. Filing Service Tax Returns
Once registered, you need to file service tax returns for every taxable period, reporting both accrued and received amounts as per return format.

Returns are filed monthly or quarterly depending on turnover.

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