Service tax

Dear Megha,

Registration is required once the value of services provided exceeds Rs. 900000. and payment is required after the value exceeds 1000000.

so, between these amounts, regn is required but collection and payment is not required

you are welcome.

hope it was clear..

Ankit

Megha,

Under the new service tax, when value of Taxable services during the Financial Year Exceed exceed Rs. 9,00,000/-, then service provider is required to get registered under service tax.

for taxablity under service tax turnover of previous financial year (PY) is being considered, 

If PY turnover exceed Rs. 10,00,000/- ,then in Current year Service tax will be charged on whole value. i.e. no exemption will be given

& If PY turnover did not exceed Rs 10,00,000/-, then in Current year upto Rs. 10,00,000/- no service tax will be charged & on above than 10,00,000/- service tax will be charged @ prevailling rate.

* Here it is important that

Turnover means value of taxable services.

one more question sir..... a dealer purchased goods for rs. 2,00,000 and after adding expenses of rs. 10,000 and profit of rs. 25000 had sold out the same...... how to compute the invoice value to be charged and amount of tax payable under VAT.

Ist of all there are three method for computation of VAT:-

1. The subtraction method
2. The addition method
3. Tax credit method (or Invoice Method)

The subtraction method:- Under the method the tax rate is applied to the difference between the value ofoutput and the cost of input;

The addition method:- Under this method value addes is computed by adding all the payments that are payable to the factors of production(wages,salaries, interest,payments, etc.);
Tax credit method(or Invoice Method)- Under this method, it entails set-off of the tax paid on inputs from tax collected on sales,indianstates opted for tax credit method, which is similar to cenvat.

Megha,

in my opinion

If VAT is Calculated as per Invoice Method:-

PARTICULARS                      Amount (In Rs.)

Purchase cost                       2,00,000/-

Add:-  Additiional Cost            10,000/-

Add:- Profit                                 25,000/-

      TOTAL                               2,35,000/-

Therefor Invoice Value would be Rs. 2,35,000/- & Output VAT will be charged on such invoice value @ Prevailling rate

out of such Output VAT, Input VAT will be deducted, and remaining has to be paid.

Thanks a lot sir.....

can u  please suggest some books to study service tax and VAT, or some online sources.

Megha,

 Online source to bahut badia h "GOOGLE"