Service tax
C.J.Sriram
(Querist) 02 February 2016
This query is : Resolved
A service provider-consultant- crosses the threshold limit of 10 lacs for the first time and register and obtain Service tax registration. He also collects and pay Service tax in that 1st year and comply with filing ST3 return.
During the 2nd year, he earns only 6 lacs from providing Service.
Should he continue to charge and collect service tax, even though he is aware that in the 2nd year he is not going to cross 10 lacs.
Query:1. Is he bound to collect tax in the second year , where he has not earned 10lacs. What should he do with the S.Tax, if billed and collected, but not liable, since his earning is below 10 lacs.
2.Is he supposed to file S.Tax returns in ST3 during 2nd year also.
3. Is it that he should continue to collect and pay S.Tax once he registers initially, whether he crosses 10 lacs or not in subsequent years-
Kindly give your expert views.
H.M.Patnaik
(Expert) 02 February 2016
Answer:
Once registered under the Service Tax Act,Your liability continues till you surrender the Regn. certificate. So, you have to charge tax as applicable on the service value billed , deposit the tax component and file periodic returns as required under the relevant rules.
Rajendra K Goyal
(Expert) 03 February 2016
Consult local service tax consultant.
