Service tax input credit

IF YOU ARE PROVIDING TAXABLE AS WELL WELL AS EXEMPTED SERVICES THEN YOU WILL EITHER HAVE TO MAINTAIN SEPERATE ACCOUNT FOR  CREDIT OF THESE TWO HEADS OR YOU WILL HAVE TO PAY 6% DUTY OF EXEMPTED SERVICE AS PER RULE 6 OF THE CENVET CREDIT RULE.BUT THERE IS A EXEMTION IN THE RULE ITSELF WHICH SAYS THAT SEPERATE ACCOUNT OR PAYMENT OF 6% IS NOT REQUIRED IF THE GOODS ARE EXPORTED AS THIS PROVISION IS ONLY APPLICABLE TO GOODS YOU HAVE TO  MAINTAIN SEPERATE ACCOUNT OR PAY 6% DUTY..

dear kumar,

   Rule 6 applies where both exempted goods and taxable goods are manufactured or exempted and taxable services provided

¨     Following 4 options are available to assessee

 (1) Maintain separate inventory and accounts of receipt and use of inputs and input services used for exempted goods/exempted output services and take only eligible Cenvat Credit – Rule 6(2) of Cenvat Credit Rules

(2) Take Entire Cenvat Credit and pay amount equal to 6% of value of exempted goods (if he is ‘manufacturer’) and of value of exempted services (if he is service provider)

(3) Take Entire Credit and pay an ‘amount’ equal to proportionate Cenvat credit attributable to exempted final product/ exempted output services, as provided in rule 6(3A) – Rule 6(3)(ii) of Cenvat Credit Rules

(4) Maintain separate accounts for inputs and pay ‘amount’ as determined under rule 6(3A) in respect of input services

Dear Vikas & Prabhat,

Thank you very much for your views.

Hi Vikas,

So we can take input credit by paying @ 6 % on our exempted Turnovers .

 I h come across multiple views regarding Input credit

Some one says need to manitain separate accounts if company having exempted turnovers.

Few of them saying if we pay ST @ 6 % on Exempted Turnover, we can availe input credit by maintaing the proper recrods. 

In view of the above, I request  you all kindly guide me to proceed further.

Thanks in advance,

Dear Kumar,

From your query i understand that you are rendering Domestic and Export of Taxable Service. Otherthan Export no other exempted Services are rendered.

Please note that Export is not an Exempted Service and no Need to reverse CENVAT Credit and not need to pay any % of Service Tax.

You can avail full credit.

Incase you are unable to utilised for Domestic Turnover. You can claim Refund Claim too..... :)

Need more clarity contact: +8527777445

Dear Hitesh,

Incase you are an merchant exporter no CENVAT benefit for you :(

However, you are manufacturer then under duty drawback scheme two options are either with CENVAT credit benefit or without CENVAT credit benefit. Check which option you have opted.

Incase with CENVAT Credit you may utilise for duty payable  but cannot get refund under CENVAT Scheme.

Dear all,

Please let me know

While paying service tax on immovable property any input service tax credit can be avail. e.g service tax paid on Professional or Consultant Service..??

If you can prove it as input service for your business, you can take the credit. But it is prefereble you do not take any such input.

Input on courier services can be availed if it is not used for export services, exempt services or any such service which does not allow service tax credit. But cenvat credit can be taken on couriers sent for business promotions, quotations or any such items. Also, credit cannot be taken if it is used for providing after sales services or any other purpose.

Dear All,

If One having Manufacturing Business can he take input credit for Service tax paid to Clearing & Forwarding Agent..??

Pls Rly soon..

Thanks.

Reagards,

Arpit Parikh.

Dear Friends

I have a Query

My company is having two services of Service tax and we are taking cenvat credit for one service and paying for another service. But in one service cent vat is excess than paying service. Can we use input credit for other service.

Regards

Vinay

Manager Finance

hi good morning to every one,please let me know can we claim telephone bill service tax as a input tax to our business service tax payables.