When does service tax become applicable

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Querist : Anonymous

Querist : Anonymous (Querist)

15 November 2013 Hi,

I have a proprietorship firm handling recruitments. I wanted to know when does service tax become applicable. My last years turnover was 2L and this year has reached 8L. Do I have to charge service tax now or will it become applicable when I cross 10L this year. kindly advice

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 November 2013 it will become applicable when you touch 10 lakhs this year.

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Querist : Anonymous

Querist : Anonymous (Querist)

15 November 2013 Thank you. Have one more query, As a proprietory ship firm what is the applicable rate of service tax to be charged? Do I charge full 12% or will part of it paid by the client directly.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 November 2013 that shall depend on whether services provided by you are covered under reverse charge mechanism or not.

Querist : Anonymous

Querist : Anonymous (Querist)

15 November 2013 can you please elaborate on this point

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 November 2013 normally, service tax is to be paid by the service provider at full 12%

However, certain service providers are covered under service tax mechanism in which the service receiver pays the service tax.

for details, please refer https://www.caclubindia.com/articles/reverse-charge-mechanism-in-service-tax-an-overview-15865.asp#.UoYWEieKK9g

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