Query on Service tax Calculation

ON 60000

HI

SERVICE TAX IS TO BE CHARGED ON THE PROVISION OF SERVICES

IN CASE OF ADVANCE RECEIPTS SERVICE TAX IS TO BE PAID ON WHOLE AMOUNT .

HENCE, IN YOUR CASE SERVICE TAX IS TO BE CHARGED ON WHOLE AMOUNT OF RS. 2,40,000.

MOREOVER IF IN YOUR CASE YOU HAVE RECEIVED ONLY RS. 2,40,000 FROM THE PARTY THEN IT WILL BE TREATED AS INCLUSIVE OF SERVICE TAX.

AND ACCORIDINGLY SERVICE TAX WILL BE CALCULATED AS FOLLWOS -

(2,40,0001*12.36%)/112.36

My question about on service tax credit availament.

If a firm doing 3 type of business say; trading in stock market, rent income, coaching classes..

trading in the share market, service tax charged on trading activity and it is possible that he cab take credit of that service tax against the service tax payable on the coaching classes....?

Advance received against services which will be provided in future.. whether i am liable to pay service on full amount..? What will be  the position if the services ranges for more than 3 years.

.

PAY 60,000.00 AS RENT WITH TAX AMOUNT BY CHEQUE

AND

ALSO ASK FOR A SEPARATE CHEQUE AMOUNT OT Rs 20,000.00 AS REFUND.FOR ADVANCE

.

Hi Ganesh,

The individual to whom the rent is paid is liable to pay service in following manner -

On the first occation when he receives 2,40,000/- as advance, Service tax  @ 12.36 % (presumed that the rate in your problem is 12.36%, else the current rate is 10.30%) on whole 2,40,000/-

On subsequent occations, the actual receipt to that individual will be 40,000/- (60000-20000). So the service tax will be payable on 40,000/- and not on 60,000/-.

Dear Manish,

In your case, all the 3 services are independent of each other and no single service can be termed as input service for either of the other 2 services. Hence, you cannot avail the credit of service tax paid on these services in any case.

Dear Saravanan V.

you need to pay service tax on whole amount received as advance irrespective of duration of service.