Point of taxation & cenvat credit

933 views 4 replies

swetha

Finance Manager

140 Points Joined September 2010

Please clarify

Manpower Bill Date: 01.09.2012

Service rendered for the month of August 12

Payment made by us to the service provider : 31.10.2012

Service provider already charged 25% of ST on their bill

1. Point of Taxation for service receiver for payment of 75% of Service Tax.

2. If 75% of service tax paid by the service receiver on 5.11.2012 by cash to the department, then at what date/month he can adjust the cenvat credit towards payment of central excise and service tax to be paid { as service Provider}

Replies (4)

CA.Ganesh

Practicing Chartered Accountant

308 Points Joined December 2008

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Anandan

HOD accounts

502 Points Joined June 2012

@ swetha....

1. In the case of reverse charge, service tax has to be paid only after making payment to the service provider. In the present example

if you make the payment in Nov.12, then you have to pay ST @ 75% on or before Dec.6th.

2. You can avail the cenvat credit based on the payment challan made for the 75% of S.T.

Regards

Anandan.s

CA Ruben Balooni

Professionalism ™

1324 Points Joined December 2008

Solution to Query 1 : As per Rule 7 Of Point Of Taxation Rules, POT shall be Date of Payment i.e 31.10.2012

Solution to Query 2 : The service provider can book the CENVAT CREDIT in the month of November and can utilise it against the liability of Excise Duty or Service Tax for the month of November of Quarter Ending December, as the case may be.

- Ruben Balooni

CS,CA F,Numrologi TusharSampat

CS CA F Numerologist Astrologer Graph

85935 Points Joined May 2010

Solution to Query 1 :

As per Rule 7 Of Point Of Taxation Rules, POT shall be Date of Payment i.e 31.10.2012 (since it is recieved within 6 months as under rule 7)

Solution to Query 2 :

The service provider can avail the CENVAT CREDIT in the month of November and can utilise it against the liability of Excise Duty or Service Tax for the month of November of Quarter Ending December, as the case may be.