liability to pay service tax

Liability to service tax arises only on receipt of the amount for services rendredd or to be rendered. Which means even for advance receipt of amount service tax has to be paid.

As per Section 67, w.e.f 16/06/2005,a person is liable to pay service tax as soon as the consideration towards the taxable services is received..This indicates that through services have been provided but the consideration has not been received, there is no liability to pay service tax.

An Explanation(3) to Section 67, clarifies that the gross amount charged for the taxaber serviceshall include any amount received towards the taxable services received before during or after provision of such service. This indicates, service tax liabilty is created towards advance payment and service are not provided.

ST has to be paid on receipt of consideration & also on the advances received for the services to be provided, However, the trade has challenged the leviability of ST on mobilization advances.

IF YOU DONT RECEIVED PAYMENT FOR SERVICE RENDERED THEN YOU NEED NOT TO DEPOSIT SERVICE TAX TO DEPT SINCE ITS PAYABLE ON ACUAL RECEIPT OF MONEY.

IF ADVANCE PAYMENT IS RECEIVED THEN YOU HAVE TO PAY SERVICE TAX ON THE AMOUNT RECD ASSUMING IT IS INCLUDING SERVICE TAX.