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Service tax payment received in advance

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Hi,

We (ABC Pvt. Ltd.) have leased our premises to XYZ organisation for which we are receiving License Fees monthly say Rs.20000/- on which we are charging ST @ 12.36% (Rs.2472) under service tax catagory Renting of Immovable property. The payment term of License Fees is in advance on or before 10th of that month.

Now my query is in June, 2012 we have received License Fees inclusive of Service Tax and after deduction of TDS of July, 2012 month in advance dated 28/06/2012 for which we have not yet booked the invoice.

Kindly tell me that when should I pay service tax of said July, 2012 month License fees and when should I book the Invoice for July, 2012 month

Replies (1)

Ajit kumar Dubey

Taxation Manager

797 Points Posted on 02 July 2012

As per the service tax rules and the point of taxation rules, an invoice has to be raised within 30 days of the provision/ completion of a service. But when money is received or agreed to be received before any invoice is raised, then the point of tax is the date of receipt of the money.Hence in your case payment date should be on or before 5th July,2012.