When to start charging service tax ?

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Nupur Sharma (Querist)

24 June 2015 Hi All,

A client of mine is working as a freelancer and he has registered himself for service tax voluntarily. He was covered under export of services exemption earlier and hence was not liable to deposit any service tax, still he got himself voluntarily registered and filed NIL returns.

Now, he has started providing services to Indian clients as well from this year. My question is that should he start charging service tax from his clients right from the first invoice issued to an indian client for domestic services or should he wait till he crosses Rs. 10 Lacs taxable services (i.e. domestic services ) value and then start charging service tax ?

I am confused because I have read it a couple of times that if a person is voluntarily registered for service tax then he must start chargin and depositing service tax right from the first invoice.

Please help ... I could not find a solution to this query anywhere.

thanks

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

24 June 2015 No need to charge service tax up to 10 lacs for the first year of service exceeding 10 lacs. It has to be charged on services exceeding 10 lacs. From next year service tax has to be charged from Rupee one.

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