Service Tax calculation

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Susanta (Querist)
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21 May 2011 Hi,
Suppose i provide a service for Rs 10,000.
Then Service tax = 10000*10.3%=1030
So the total billed amount to be paid by the client should be Rs 10,000+ 1030= 11,030

But what if the client pays only 10,000. And not the tax amount. What should be the Service tax amount now. And how it is calculated.

Susanta

Susanta (Querist)
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21 May 2011 What is the formula.
Thanks

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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21 May 2011 value of service = 10,000 X 100 /110.30 = 9,066/-
service tax 9,066/- X10.30 % = 934/-

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Susanta

Susanta (Querist)
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21 May 2011 Thanks for the swift reply sir.
What will be the tax if amount billed is Rs60,000. (And the client don't pay the tax i.e Gross amount is 60,000)

This maths is just not getting into my mind. :(

CS Bijoy

CS Bijoy (Expert)
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21 May 2011 Amount 60,000 will be treated as inclusive of Tax and the calculation will be back such as
110.30=100 then 60,000=? 110.30 is inclusive of tax. if you want amount of tax then 10.30=100 and 60,000 = ?
do the some u can find the answer.

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Susanta

Susanta (Querist)
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21 May 2011 Just check my calculation, and let me know if i am correct.
For service amount Rs 60,000/-
If client pays the tax then,
Service value = 60,000 + 60,000 x 10.3 %=Rs 66180/-
And service tax amount = Rs 6180.

And Now for , if client doesn't pay the tax then,
Service Value= 60,000 x 100/110.3= Rs 54397/-
Service tax= 54397 x 10.3 % = 5603/-

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CS Bijoy

CS Bijoy (Expert)
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21 May 2011 Your above calculation is correct.

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Susanta

Susanta (Querist)
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21 May 2011 Thanks a lot for replying..:)
Have a nice day.

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