Payment of Service Tax on accrual basis
PrintListen to this Article
Service tax is paid on billing basis or accrual basis since the Point Of Taxation Rules 2011 has been introduced. It is mandatory for all service provider to pay service tax on accrual basis since July 2011 except professional.
The purpose of this amendment is that the payment of service tax is linked to receipt of payment for the service, which is at odds with regime in force in Central Excise and VAT laws implemented by the states. In both Central Excise and VAT, tax payment is required on accrual basis - upon manufacture and clearance of goods in the former and issue of invoice in the latter. In neither case is the tax payment linked actual receipt of payment for the goods. The GST regime is likely to follow this practice and it is necessary to align the service tax regime with it so that transition to GST will be smooth. The change in the point of payment of tax will also simplify accounting for the taxpayers.
Category : Service Tax | Comments : 1 | Hits : 1577
CENVAT CREDIT ON SET TOP BOX INTRODUCTION Service providers have at least a Telephone in their office. They are paying service tax on the telephone charges. The service tax on telephone charges becomes a part of the cost for the service provider. When he collects service tax from the customer it becomes tax on tax which increases the actual rate of tax payment. This phenomenon of tax on tax is called the cascading effect. The government does not want this to happen. The...
NO KRISHI KALYAN CESS ON DEBTORS AS ON 13th MAY’ 2016 (PART -2) Read more at: http://www.casansaar.com/article-submit.htmlThe enabling provisions for KRISHI KALYAN CESS (KKC) are contained in Chapter – VI of Finance Act’ 2016. As per the provisions, KKC shall be applicable at 0.5% on all taxable services and the proceeds of KKC would be exclusively used for financing initiatives relating to improvement of agriculture and welfare of farmers. The Cess will come into force with ...
As you are aware that the Finance Act, 2016 has increased the service tax rate to include a new cess, namely Krishi Kalyan Cess, which is applicable w.e.f. 01/06/2016. The effective rate of service tax for all new services provided after 01/06/2016 shall be as below: Service Tax ...
CENVAT CREDIT AVAILABLE VS CENVAT CREDIT TAKEN ALARMING AMENDMENT IN RULE 6(3) OF CENVAT CREDIT RULES (a) A manufacturer who manufactures two classes of goods namely:- Non exempted goods removed Exempted goods removed Or (b) a provider of output service who provides two classes of services, namely:- Non Exempted Services Exempted Services Shall follow any one of the following options applicable to him namely:- (i) pay an amount equal to 6% ...
Date : 19.03.2016 M/s. ABC LLP ( Service Provider ) M/s. XYZ Limited ( Service Recipient ) Ref: Service Tax on Works Contract and RCM Opinion Before giving opinion on the issues it will be useful to refer the questions related with this transaction. Assume ABC is LLP and XYZ Ltd is Body Corporate. ABC LLP is a sub contractor of XYZ Limited. XYZ Ltd sub contracted Works Contract work as well as Labor work also some time. Both partie...
Comments
manish sharma
30-Sep-2011 , 12:27:37 pmGOOD