Service tax on accrual basis?

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Querist : Anonymous

Querist : Anonymous (Querist)

11 March 2011 whether service tax will be considered on accrual basis from 1st april 2011 onwards?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

11 March 2011 Yes ,by virtue of notification 18/2011-ST dated 01/03/2011.

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Querist : Anonymous

Querist : Anonymous (Querist)

12 March 2011 meaning point of taxation rules?
thank You Sir.

Querist : Anonymous

Querist : Anonymous (Querist)

18 March 2011 meaning point of taxation rules?

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

24 July 2025 Sure! Here’s a quick explanation:

**Service tax on accrual basis / Point of Taxation Rules:**

* Before **1st April 2011**, service tax was generally payable **on receipt of payment** (i.e., when you actually get the money).

* From **1st April 2011 onwards**, due to **Notification No. 18/2011-ST dated 01/03/2011**, service tax liability is triggered **on the earlier of these two events**:

* When **invoice is issued**, or
* When **payment is received**.

This means **service tax is payable on the accrual basis** — i.e., you pay tax as soon as you raise the invoice or receive payment, whichever is earlier.

This rule is part of the **Point of Taxation Rules, 2011**, which specify the timing of when service tax becomes due, to bring uniformity and clarity.

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