Service tax liability on package service in a beauty clinic

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2015 Dear All,

Need your valuable suggestion on an issue:

One of my client (Pvt. Ltd. Company) is in beauty service industry providing skin & beauty services to customers. They provide services as package in which customer would have to come for service 4 to 10 times on monthly basis. Further payment is also received on Installment basis when they visit for taking service.

Now my question is how to pay service tax in this case? Whether liability for service tax will arise at the time of booking of service or on the basis of payment received.?

Further whether it is an example of continuous service?

Please Suggest ASAP !!

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

19 November 2015 Raise invoice on the basis of payment received so that service tax remitted on invoice basis.

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2015 Invoice is generated from software which contains details. for e.g

Package Cost:1,00,000/-
Service Tax: 14,000/-

Total : 1,14,000/-

Amount Received: 20,000/-
Credited to Service Tax: 2533/-

Due: 94,000/-

What to Do??

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

19 November 2015 You can modify the soft ware so that it will raise the invoice only for the amount received and keeping in memory the package cost details.

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2015 If Software can not be modified, then what will be the tax liability in this case?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

19 November 2015 If your total service provided in a year is less than 50 lacs you can pay service tax on receipt basis.

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2015 Whether provision of continuous service will apply in this case?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

19 November 2015 For this service continuous service will not apply.