Provisions related to payment of service tax and rate of service tax
Any person providing taxable service to any person shall pay service tax at the rate specified in Sec.66 in such a manner and within such period as may be prescribed.(Sec.68 of the Finance Act, 1994)
From 01/04/2012 onwards applicable rate of service tax is 12%+2% primary education cess+1%secondary education cess
- In case of Individuals or Proprietary Concerns and Partnership Firm, service tax is to be paid on a quarterly basis. The due date for payment of service tax is the 5th of the month immediately following the respective quarter ( in case of e-payment, by 6thof the month immediately following the respective quarter). For this purpose, quarters are: April to June, July to September, October to December and January to March. However, payment for the last quarter i.e. January to March is required to be made by 31st of March itself.
- In case of any other category of service provider other than specified at above, service tax is to be paid on a monthly basis, by the 5th of the following month (in case of e-payment, by 6th of the month immediately following the respective month).However, payment for the month of March is required to be made by 31st of March itself.
- Service tax is to be paid to the Central Government in respect of service deemed to be provided.
- e-payment of service tax has been made mandatory for the Assessees who have paid service tax of Rs.10 Lakh (cash+ cenvat) and above during the last financial year or who have paid service tax of Rs.10 Lakh (cash + cenvat) and above during the current financial year. The e-payment shall be made only in designated banks by 6th day of the following month.
- The assessee is required to deposit the amount of service tax in the designated banks through GAR-7 challan.
- If the assessee deposits the amount of tax liable to be paid, by cheque, then the date of presentation of the cheque to the designated bank would be treated as the date of payment of service tax.
- Where an assessee has issued an invoice, or received any payment, against a service to be provided which is not so provided by him either wholly or partially for any reason, or where the amount of invoice is renegotiated due to deficient provision of service, or any terms contained in a contract the assessee may take credit of such excess service tax paid by him, if the assessee:-
- has refunded the payment or part thereof, so received for the service provided to the person from whom it was received or
- has issued a credit note for the value of the service not so provided to the person to whom such an invoice has been issued
- The assessee can opt for provisional payment of service tax in case he is not able to correctly estimate the tax liability. In such a situation he may request in writing to the jurisdictional Assistant / Deputy Commissioner for the same.
- Service tax (including interest, penalty, and refund) is to be rounded off to the nearest rupee. 50 paise or more should be rounded off to the next rupee and less than 50 paise should be ignored.
- Any person, who has collected any sum on account of service tax, is under obligation to pay the same to the Government. He cannot retain the sum so collected with him by contending that service tax is not payable.
- As per notification no. 01/2010-S.T. dated 19/02/2010, relevant period 01/04/2010 onwards, where an assessee has paid total service tax of rupees ten laces or more ( including the amount paid by utilization of CENVET Credit ) during the preceding financial year then he is mandatorily required to deposit service tax liable to be paid by him electronically through internet bankin