Service tax is an indirect tax levied by the Central Government on taxable services provided. The concept of service tax in India has been introduced in 1994 by making provisions in the Finance Act, 1994. Service tax registration is mandatory for every person or business providing taxable services of value exceeding Rs.9 lakhs, in the previous financial year. But service is chargeable only when value of taxable services exceeds Rs.10 lakhs.
 

Rate of Service Tax

At present rate of Service Tax is 14% plus 0.5% Swachh Bharat Cess aggregating to 14.5%.
 

Payment of Service Tax

Every assessee, after getting service tax registration has to charge and collect service tax on service provided and deposit the same on monthly basis in case of company and LLP assessee or on quarterly basis in case of society, partnership firm, and proprietorship firm. The service tax liability should be deposited on or before 5^th (in case of payment through bank challan) or 6^th (in case of e-payment) of the next month or quarter as the case may be.

E-payment of service tax has been made mandatory w.e.f. 1-10-2014 for all assessees.
 

Filing of Service Tax Return

Every assessee registered with Service Tax Department has to mandatorily file Service Tax Return in Form ST-3 (Original) or ST-3A (Provisional) on half-yearly basis.

Electronic filing of Form ST-3 has been made mandatory for all Service Tax assessees w.e.f. 01.10.2011. Therefore no manual returns could be filed, entertained or accepted.
 

Due Date for Filing of Service Tax Return

Service tax return is filed once in six months as –

1. For the half-year starting from the 1st of April - 30th of September, the returns are to be filed by the 25th of October.

1. For the half-year starting from the 1st of October - 31st of March returns are to be filed by the 25th of April.

It means Service Tax Return is to be filed within 25 days from the end of financial half year.
 

Nil Return Mandatory Even If No Turnover

Even if there was no business during the period, the assessee will have to file ‘Nil’ return as long as service tax registration number is valid.
 
 
Penalty for Delay in Filing Service Tax Return

In case where returns are filed after due date, late fee payable is as follows:-

1. Delay up to 15 days: Rs.500.00

1. Beyond 15 days but up to 30 days: Rs.1000.00

1. Delay beyond 30 days: Rs.1000.00 plus Rs.100 per day of delay beyond 30 days, from 31^stday onwards. This Rs.100.00 per day continues till limit of Rs.20000.00 is reached.

But the maximum late fees shall not exceeding Rs.20000.00 for delayed filing of return in any case.
 

Revised Return

In case there is any mistake in Form ST-3, then an assessee can rectify mistakes and file revised Form ST-3 within 90 days from the date of filing of the original Form ST-3 return.


(Author: Amar Kumar, CS Final)