Service Tax for Authorized Money changer
This query is : Resolved
13 November 2009
Dear All
I am a small money changer with an annual sale of Rs.3.00 crores. After the recent amendment, i am charging Rs.25.00 as service charge per purchase and sales transactions. All together my service charge for the last accounting year is Rs.15075/-. Do I cover under service tax treshold limit?
I am a small money changer with an annual sale of Rs.3.00 crores. After the recent amendment, i am charging Rs.25.00 as service charge per purchase and sales transactions. All together my service charge for the last accounting year is Rs.15075/-. Do I cover under service tax treshold limit?
13 November 2009
NO YOU ARE NOT UNDER COVER OF SERVICE TEX YOU ARE UNDER EXEMPTION LIMIT.
24 July 2025
Here’s a clear explanation regarding **Service Tax applicability for Authorized Money Changers (AMCs)** based on your query:
---
### Service Tax Applicability for Authorized Money Changers
1. **Threshold Limit**:
The **service tax threshold limit** (as per rules applicable around 2009) was typically **Rs. 10 lakhs per year** of taxable service turnover for most service providers to be liable for service tax registration and payment.
2. **Service Charge Turnover**:
In your case, the **total service charge collected during the last accounting year is Rs. 15,075 only**, which is well below the threshold limit.
3. **Is Service Tax Applicable?**
Since your **taxable service turnover is less than Rs. 10 lakhs**, you are **exempt from service tax registration and payment** as per the exemption limit.
4. **Amendments**:
Recent amendments (as of 2009) did introduce service tax on authorized money changer services, but the threshold limit still applies.
---
### Summary
| Parameter | Your Situation | Service Tax Status |
| ---------------------------- | ------------------------ | ---------------------------- |
| Annual Service Charge Income | Rs. 15,075 | Below threshold |
| Threshold Limit | Rs. 10 lakhs (1,000,000) | Not liable for service tax |
| Service Tax Liability | No service tax payable | Exempt under threshold limit |
---
### Final Note
* You **do not have to register or pay service tax** on your authorized money changer service charges if your taxable turnover remains below Rs. 10 lakhs annually.
* If your service charge exceeds Rs. 10 lakhs in any subsequent year, you will need to register and pay service tax accordingly.
---
If you want, I can help draft a formal note or provide further guidance on maintaining records or voluntary registration if you anticipate growth. Want me to?
---
### Service Tax Applicability for Authorized Money Changers
1. **Threshold Limit**:
The **service tax threshold limit** (as per rules applicable around 2009) was typically **Rs. 10 lakhs per year** of taxable service turnover for most service providers to be liable for service tax registration and payment.
2. **Service Charge Turnover**:
In your case, the **total service charge collected during the last accounting year is Rs. 15,075 only**, which is well below the threshold limit.
3. **Is Service Tax Applicable?**
Since your **taxable service turnover is less than Rs. 10 lakhs**, you are **exempt from service tax registration and payment** as per the exemption limit.
4. **Amendments**:
Recent amendments (as of 2009) did introduce service tax on authorized money changer services, but the threshold limit still applies.
---
### Summary
| Parameter | Your Situation | Service Tax Status |
| ---------------------------- | ------------------------ | ---------------------------- |
| Annual Service Charge Income | Rs. 15,075 | Below threshold |
| Threshold Limit | Rs. 10 lakhs (1,000,000) | Not liable for service tax |
| Service Tax Liability | No service tax payable | Exempt under threshold limit |
---
### Final Note
* You **do not have to register or pay service tax** on your authorized money changer service charges if your taxable turnover remains below Rs. 10 lakhs annually.
* If your service charge exceeds Rs. 10 lakhs in any subsequent year, you will need to register and pay service tax accordingly.
---
If you want, I can help draft a formal note or provide further guidance on maintaining records or voluntary registration if you anticipate growth. Want me to?
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