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Service tax

*JaiNitH KuMaR* (*Aspire Then Inspire* !!) (217 Points)

26 August 2012

In The computation of service tax we charge service tax on the value on which service tax is payable...

But sometimes before applying rate we deduct exemption for small service providers i.e. 1000000 from the total value of service..!!

So can u tell me when to deduct n when not to deduct 1000000 from the total value of service...?

Waiting for the earliest reply plzzzzzzz

Thanking you

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4 Replies

Sumit Grover (Chartered Accountant ) (3652 Points)
Replied 26 August 2012

In case, value of taxable services of previous year does not exceed Rs. 10Lacs, only then the assessee is entitled to avail exemption of Rs. 10 Lacs in current year......However, his exemption limit is not available in case of reverse charge mechanism.

Also find the attached file for example

Attached File : 91650 1044734 service tax.xlsx downloaded: 137 times

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*JaiNitH KuMaR* (*Aspire Then Inspire* !!) (217 Points)
Replied 26 August 2012

Originally posted by : CA Sumit Grover
	In case, value of taxable services of previous year does not exceed Rs. 10Lacs, only then the assessee is entitled to avail exemption of Rs. 10 Lacs in current year......However, his exemption limit is not available in case of reverse charge mechanism. Also find the attached file for example

Thank you sir..

But can u tell me what is this reverse charge mechanism..??

Sumit Grover (Chartered Accountant ) (3652 Points)
Replied 26 August 2012

Generally,service provider is liable to pay service tax for the services provided. However, the govt has notified some services in which the service receiver has to pay certain portion of service tax liability or the whole or service tax liability.......

*JaiNitH KuMaR* (*Aspire Then Inspire* !!) (217 Points)
Replied 26 August 2012

Originally posted by : CA Sumit Grover
	Generally,service provider is liable to pay service tax for the services provided. However, the govt has notified some services in which the service receiver has to pay certain portion of service tax liability or the whole or service tax liability.......