Service tax payment in uncertainty.

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  1. Ghanshyam Jethwa

    Ghanshyam Jethwa New Member

    During last financial year, my income was about Rs. 9.95 lakh, but this year it might cross Rs. 10 lakh by end of March 2015, though I am not sure about it as of today (12-Oct-2014).

    2014-15 is the first financial year in which I have obtained service tax registration for my management consulting service. My current income from Mar-2014 to Sep-2014 has crossed Rs. 5 lakh. The ST-3 return is due on 25 Oct. Should I just fill in NIL return by 25 Oct? If my income crosses Rs. 10 lakh by February or March 2015, what is the implication for service tax payment? When and how much service tax I'll need to pay?
  2. gaurav_kumar

    gaurav_kumar Well-Known Member

    Dear Sir

    Service Tax is applicable if the total value of services exceeds Rs. 10 Lakhs in the financial year.

    As you were required to apply for Service Tax Registration as soon as it crossed 9 Lakhs, you have to file a Service Tax return.

    However, don't file a Nil Return. Disclose the Value of Services provided by you and then claim Small Scale Exemption i.e. exemption for value of services under Rs. 10 Lakhs.
    Last edited: Oct 14, 2014
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  3. You can start collecting service tax for the services you provide once it crosses Rs.10 Lakhs and file the return accordingly. You can file the NIL return till then. You can pay service tax on the amount after it crosses Rs.10 Lakhs. If turnover is Rs.11 Lakhs, then you can charge ST on Rs.1 Lakh.

    Service Tax is applicable once it crosses Rs.10 Lakhs in any financial year.
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  4. Ghanshyam Jethwa

    Ghanshyam Jethwa New Member

    Dear Mr. Gaurav Kumar,

    Many thanks for your valuable advice.

    If I disclose the Value of Service provided by me for the current year in filing the Return, do I have to pay the service tax and then claim it back under Small Scale Exemption? What would be its benefit as compared to filing NIL return?

    Thanks again for your advice.

    With kind regards.

    Ghanshyam Jethwa.
  5. gaurav_kumar

    gaurav_kumar Well-Known Member

    In both the cases - the tax payable by you would be Nil.

    However, in case you disclose that you have not provided any service - it would be a mis-statement as you have provided services.

    So you should first mentioned the details of the services provided by you and then claim Small Scale Exemption from the same.
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