As we know that Point of Taxation has been changed from 01.07.2011.
So now how to tell the tax to the assessee.
Suppose assessee had taken advance of Rs. 500000 on a service in July. So he will deposit 51500 on the same in july.
Now if he receives final payment in december, then he will pay tax on the balance.
The problem here is that if i am collecting 500000 as advance payment then whether it should be considered as inclusive of service tax or not. And if yes then the receipt that the assessee will give to his client. How will he show service tax on the same.
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Service tax problem
Replies (3)
Receipt of advance is point of taxation . There is nothing wrong is treating the advance as inhclusive of service tax.
Agree with Mr. Nair, that advance should be treated as inclusive of ST.
Advance received shall be treated as cum tax.
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