Services specified for receipt basis or accrual basis

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Querist : Anonymous

Querist : Anonymous (Querist)

04 July 2015 Dear Sir,
I Have a query regarding service Tax that Which are the services specified for Receipt Basis or Accrual Basis. I Know that for Accrual Basis limit is Rs. 50 Lakh but i want to know that this limit is for all services or for some specified services. Please Let me know.
Thanks
Gaurav Chauhan

Querist : Anonymous

Querist : Anonymous (Querist)

11 September 2015 Dear Sir, I Have a query regarding service Tax that Which are the services specified for Receipt Basis or Accrual Basis. I Know that for Accrual Basis limit is Rs. 50 Lakh but i want to know that this limit is for all services or for some specified services. Please Let me know. Thanks
Gaurav Chauhan

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
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25 July 2025 Hi Gaurav,

Regarding **Service Tax payment on Receipt Basis vs Accrual Basis**, here’s the clarity you need:

---

### 1. **Accrual Basis (General Rule)**

* Normally, **service tax is payable on the value of taxable services "on accrual basis,"** i.e., when the service is provided or invoice raised, whichever is earlier.
* This applies **to all services** by default.

---

### 2. **Receipt Basis (Optional Scheme for Small Taxpayers)**

* **Receipt basis means service tax is paid only when payment is actually received from the customer.**
* The **Government introduced an optional scheme to pay service tax on receipt basis for certain services and eligible service providers.**

---

### 3. **Eligibility & Limit for Receipt Basis**

* This option is **available only to service providers whose aggregate value of taxable services is up to Rs. 50 lakh in the preceding financial year.**
* This **limit of Rs. 50 lakh is for all taxable services combined**, not per service.

---

### 4. **Services Allowed for Receipt Basis Payment**

* **Not all services qualify** for receipt basis payment.

* **Specified services under Rule 6(3) of the Service Tax Rules, 1994**, are eligible.

* Some of the common eligible services include:

* Transport of passengers by stage carriage, contract carriage, or radio taxi
* Services provided by travel agents
* Services by advocates
* Services by arbitral tribunals
* Services by Chartered Accountants
* Services by Property Dealers
* Services provided by Restaurants, etc.

* (This list is illustrative; you should check the latest notifications or Rule 6(3) for exact list.)

---

### 5. **Services NOT eligible for Receipt Basis**

* Generally, services like **Banking, Insurance, Telecom, and others** are **not eligible** for receipt basis payment.

---

### Summary:

| Payment Basis | Applicable to | Limit | Services Covered |
| ------------- | --------------------------------------------------- | -------------------------- | ----------------------------------- |
| Accrual Basis | All taxable services | No limit | All services |
| Receipt Basis | Only eligible service providers with turnover ≤ 50L | Rs. 50 Lakh (preceding FY) | Specified services as per Rule 6(3) |

---

If you want, I can help you with the exact list of services eligible for receipt basis or provide the relevant Rule references.

---

**Would you like me to share the official rule and notification links?**

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