Service tax entry on provision booked

Suppose, i am a service recipient and i pay service tax on reverse charge basis on security expense. On 31st March, i have made a provision entry for march month security expense entry. I have received the bill on 13th April and reversed the provision and recorded this bill. When do i have to book the service tax entry ? And when do i have to make the payment on it?
Replies (4)

in the instant case Rule 7 of the Point of taxation Rules, 2012 would be applicable.

As per Rule 7 of the said rules, Point of Taxation in the case where person liable to pay service tax under sub section (2) of section 68 is Date of Payment. However, if the payment is not made within 3 months of the date of invoice then point of taxation shall be the date immediately following the said period of 3 months.

You have received security services, so rule 3 i.e. general rule will not apply as it is specifically covered under rule 7 of the said rules. Further, rule 7 doesn't take in to consideration aspects related to provision of service as well as provision made in books of account related to such expense or debit in the books of account except in the case of associated enterprise.

So your query is addressed as under-

1. You may book entry on 13.04.2016 i.e. date of invoice. However, it is not relevant if you make provision for the expense on year end before the receipt of invoice.

2. Liability of service tax would be 6th of the next month of the date of payment. However, if payment is not made within 3 months of the date of payment then 6th of the next month of the date immediately following the said period of 3 months.

So you mean to say. Suppose i pay the bill on the next day the invoice is raised, then i need to record and pay service tax on the next day. 

Service tax would be payable on 6th of the next month of the date of payament.

Suppose if you made payment to service provider on 14.04.2016 then service tax would have to be required to be deposited by 06.05.2016.

Thank you very much

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