Very urgent service tax related
This query is : Resolved
10 March 2012
DEAR SIR
PLEASE CLEAR THAT SERVICE TAX PAYMENT SHOULD BE PAID ON RECEIPT BASIS OR ACCRUAL BASIS FOR PROPRIETORSHIP WHO ENGAGED AS REAL ESTATE AGENT..
PLEASE...REPLY...ME..AS SOON AS POSSIBLE....
PLEASE CLEAR THAT SERVICE TAX PAYMENT SHOULD BE PAID ON RECEIPT BASIS OR ACCRUAL BASIS FOR PROPRIETORSHIP WHO ENGAGED AS REAL ESTATE AGENT..
PLEASE...REPLY...ME..AS SOON AS POSSIBLE....
10 March 2012
Now it is on accrued basis or realized receipt basis whichever is earleir.
13 March 2012
Thank You ....one moe thing i want to clear sir..can i deposit the june 2012 service tax payable now as these were not deposited due to mistakenly and include that much income in the last quarter in which i will deposit the service tax..please reply..
03 August 2025
You're asking about Service Tax payment basis and delayed payment treatment, especially for a proprietorship real estate agent back in the pre-GST regime (specifically around FY 2011–12 to 2012–13).
Let’s address both parts of your question:
✅ Q1: Should Service Tax be paid on receipt basis or accrual basis for proprietors (real estate agents)?
✔️ Applicable Rule at the time (2012):
From 1st April 2011, the Point of Taxation Rules (POTR), 2011 came into force.
Under POT Rules:
Service tax became payable on accrual basis, i.e., earliest of:
Date of Invoice, or
Date of Payment, or
Date of Completion of Service (if no invoice issued in time)
So, the service tax was NOT on receipt basis anymore unless the provider was under optional composition scheme (like for small service providers up to ₹10 lakhs).
✅ Q2: Can you deposit June 2012 service tax now (i.e., later) and show the related income in the quarter in which you deposit?
❌ Answer: No, not for service tax purposes.
Service tax liability arises as per point of taxation, not when you deposit it.
Even if you pay it late, it is still due for the period to which it belongs — June 2012 in your case.
You cannot shift the income or tax liability to another quarter just because of late payment.
This would amount to wrong reporting, and may attract interest and penalty.
✅ What should you do now?
Pay the Service Tax due for June 2012, immediately.
Pay interest for the delay (as per Section 75 of the Finance Act, 1994).
Declare the income and tax liability under the correct period (June 2012 quarter), even if you're paying late.
✅ Interest Rate (for late payment)
For that period (2012), the interest rate under Section 75 was:
18% p.a. (for most assessees)
Lower for small service providers (below ₹60 lakh turnover)
Interest is calculated from due date till actual date of payment.
✅ Summary:
Issue Clarification
Basis of service tax (2012) Accrual basis (earliest of invoice/payment/service)
Can you defer income/tax to later quarter? ❌ No, it must be reported in correct period
Can you pay June 2012 tax now? ✅ Yes, but pay with interest
Any penalty? May apply if caught in audit, but voluntary payment with interest reduces risk
Let’s address both parts of your question:
✅ Q1: Should Service Tax be paid on receipt basis or accrual basis for proprietors (real estate agents)?
✔️ Applicable Rule at the time (2012):
From 1st April 2011, the Point of Taxation Rules (POTR), 2011 came into force.
Under POT Rules:
Service tax became payable on accrual basis, i.e., earliest of:
Date of Invoice, or
Date of Payment, or
Date of Completion of Service (if no invoice issued in time)
So, the service tax was NOT on receipt basis anymore unless the provider was under optional composition scheme (like for small service providers up to ₹10 lakhs).
✅ Q2: Can you deposit June 2012 service tax now (i.e., later) and show the related income in the quarter in which you deposit?
❌ Answer: No, not for service tax purposes.
Service tax liability arises as per point of taxation, not when you deposit it.
Even if you pay it late, it is still due for the period to which it belongs — June 2012 in your case.
You cannot shift the income or tax liability to another quarter just because of late payment.
This would amount to wrong reporting, and may attract interest and penalty.
✅ What should you do now?
Pay the Service Tax due for June 2012, immediately.
Pay interest for the delay (as per Section 75 of the Finance Act, 1994).
Declare the income and tax liability under the correct period (June 2012 quarter), even if you're paying late.
✅ Interest Rate (for late payment)
For that period (2012), the interest rate under Section 75 was:
18% p.a. (for most assessees)
Lower for small service providers (below ₹60 lakh turnover)
Interest is calculated from due date till actual date of payment.
✅ Summary:
Issue Clarification
Basis of service tax (2012) Accrual basis (earliest of invoice/payment/service)
Can you defer income/tax to later quarter? ❌ No, it must be reported in correct period
Can you pay June 2012 tax now? ✅ Yes, but pay with interest
Any penalty? May apply if caught in audit, but voluntary payment with interest reduces risk
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