Service tax value for foreign exchange broker

Queries 746 views 6 replies

PIYUSH KABRA

MANAGER FINANCE

52 Points Joined April 2016

Hello experts,

I am working in a company whose business is foeign exchange dealing. i am preparing for the service tax return of company for the month Oct-march 2016. we collects service tax from customer as per rules mentioned in 7B ie.

(a) 11 [0.14 per cent. of the gross amount of currency exchanged for an amount up to rupees 100,000,
subject to the minimum amount of 12[rupees 35] and;
(b) rupees 13[140 and 0.07 per cent. of the gross amount of currency exchanged for an amount of rupees
exceeding rupees 100,000 and up to rupees 10,00,000; and

but i am in dilema which value will be mentioned in return (Actual value of service ie invoice value or Value calcuated by grossing up of service tax liablity).

and in rate column of return form ie. B1.15 which rate will be mentioed as that coulmn is not taking valule 0.14%

Please advise me and clarify this situation.

Thanks and regards

CA Piyush Kabra

Replies (6)

CA Prakash N

Head - Indirect Tax (GST & FTP)

373 Points Joined January 2012

Dear Piyush,

Foreign exchange transaction shall be shown under "Specific rate" B1.16 (as per Rule 6 of ST Rules)

Eg. One foreign currency exchange for Rs.75,000/- then show Rs. 35 as specific rate and 1 as taxable unit in month.

If the you have transactions only below Rs. 1,00,000 then No of taxable unit in month colomn and service tax will be calculated automatically.

Some more disclosure needs to be given for transaction exceeds Rs. 1,00,000/-. Let me if any such transaction exist.

S K Somani

Chartered Accountants

39 Points Joined June 2007

Hi Piyush

You need to put both i.e. Adv Value and specific rate as well.

An Illustration file is attached herewith for your knowledge.

Thanks

CA S K Somani,Delhi

9312211526

PIYUSH KABRA

MANAGER FINANCE

52 Points Joined April 2016

Dear sir,

thanks for your valuable help but i have some calculation doubt in this attached sheet.

B1.16 total tax as per specific rate come to 6840 ie. 30*2+120+660+6000 then how servie tax payble is 7488/- pls resolve this for better understanding

S K Somani

Chartered Accountants

39 Points Joined June 2007

HI Piyush

PLs note that this service tax amount is consolidated for Rate based and ADV rate . So this is calculated for specific rate as well as the adv rates of 0.12, 0.06 & 0.012 %.

Hope this clarify you

S K Somani

PIYUSH KABRA

MANAGER FINANCE

52 Points Joined April 2016

hi sir,

with some clarification now i am able to fill data in taxable service column and service tax liablity is 100% correct but there is mismatch in tax of swach bharat amount. pls help it on also.

CA Piyush Kabra