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Service tax rate

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05 June 2015 We have contracts entered with taxi owners for carrying our staff. The taxi owners are individuals. We pay service tax under RCM. The taxi owners gave invoice on June 2nd 2015 for the service provided in May 2015. The payment will be paid by 10th June 2015. Pls clarify whether we have to pay service tax under RCM @ new rate of 14% or @old rate of 12.36%? pls clarify
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CMA. CS. Sanjay Gupta

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CMA. CS. Sanjay Gupta (Expert)
06 June 2015 Switch over to new rates.

To simplify:- Rule 4 of Point of Taxation Rules change in effective rate of Service Tax: There are three events that occur in connection with a service

A. Issue of Invoice
B.Payment received
C. Provision of Service

If any two out of the three events have occurred on/before 31st May, the old rate of 12.36% shall be applicable.

If any two out of the three events have occurred on/after 1st June, the new rate of 14% shall be applicable.
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