Service tax is a part of Central Excise in India. It is a tax levied on services provided in India, except the State of Jammu and Kashmir. The responsibility of collecting the tax lies with the Central Board of Excise and Customs(CBEC). Service Tax is a form of indirect tax imposed on specified services called "taxable services". Over the past few years, service tax been expanded to cover new services and recently list of negative services has been introduced. The objective behind levying service tax is to reduce the degree of intensity of taxation on manufacturing and trade without forcing the government to compromise on the revenue needs.
For the purpose of levying service tax, the value of any taxable service should be the gross amount charged by the service provider for the service rendered by him. Service Tax is a tax imposed by Government of India on services provided in India. The service provider collects the tax and pays the same to the government. It is charged on all services except the services in the negative list of services. The current rate is 12.36% on gross value of the service.
Service Tax is only liable to be paid in case the total value of the service provided during the financial year is more than Rs. 10 Lakhs. If the value of services provided during a financial year is less than 10 Lakhs, it is optional for the service provider to pay service tax or not. But, in case he has received the service tax from the service recipient, he would be required to deposit it with the govt.
Service Tax Return, Records & Invoice
Return
- Return Form - Form ST-3a.
- Frequency of Return - Assessees who paid tax of Rs 25 lakh or more in previous year and new assessees other than individuals and firms: Monthly and Others: Quarterly
- For Ltd. company service tax will be payable monthly & rest for all quarterly.
Records
According to Rule 5 of Service Tax Rules, 1994, records include computerized data and means the record as maintained by an assessee in accordance with the various laws in force from time to time. Records maintained as such shall be acceptable to Central Excise Officer. Every assessee is required to furnish to the Central Excise Officer at the time of filing his return for the first time a list of all accounts maintained by the assessee in relation to Service Tax including memorandum received from his branch offices. This intimation may be sent along with a covering letter while filing the service tax return for the first time.
Invoice
Rule 4A prescribes that taxable services shall be provided and input credit shall be distributed only on the basis of a bill, invoice or challan. Such bill, invoice or challan will also include documents used by service providers of banking services (such as pay-in-slip, debit credit advice etc.) and consignment note issued by goods transport agencies. Rule 4B provides for issuance of a consignment note to a customer by the service provider in respect of goods transport booking services.