is service tax mandatory, if we registered with st-2 and turnover is less than 10 lakh ?

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  1. tauseef Khan

    tauseef Khan New Member

    If i registered with Service Tax registration (ST-2), and my turnover is below 10 lac per annum. Is it necessary to pay Service tax? Actually i registered as a proprietorship and used ST-2 for only Business name. Somebody said if you registered with service tax then its mandatory to pay 12.36% service tax even your turnover is below 10 lac annually.

    Please help me.
  2. Until you reach the turnover of Rs.10 Lacs p.a. in any financial year, you need not to pay service tax.

    If you have once crossed the limit in any financial year and started to pay service tax, even if your turn over is less than Rs.10 Lacks in any financial year, you need to pay service tax.
  3. gaurav_kumar

    gaurav_kumar Well-Known Member

    Dear @tauseef Khan

    As your turnover is less than Rs. 10 Lakh, you can claim service tax exemption for small scale enterprises.

    At the time of filing the service tax return, you can claim the exemption.

    As you have a service tax registration - paying service tax is not mandatory. However, filing service tax return is mandatory once you have a service tax registration.
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