Service tax liability

Exemption of 10 lakhs will be available if turnover in the P.Y does not exceed Rs 10 lakhs. Exemption upto 10 lakhs can be availed if it is the first year of operation. Hence, you can avail exemption upto 10 lakhs and charge service tax on amount exceeding 10 lakhs during the year.

The obligation for registration under Service Tax arises on the very moment Taxable Value of service provided exceeds Rs 9,00,000. Un eed to apply for registration within 30 days from 1st january. And since you are Small Service Provider, you can claim exemption from service tax for taxable value upto Rs 10, so your service tax liability will arise only in last month. So charge service in the last month on Rs 80,000 @ 12.36%.