Which rate will be applicable on advance payment received along with 12% service tax for services which are rendered either on 24.02.09 or will be rendendered after 24.02.09? Will it be 10% or 12%?
Applicability of the rate of tax
Suhit Aggarwal
Service Tax Rate on Advance Payments: 10% Applicable for Services Rendered On or After February 24, 2009, Per Notification. A query was raised regarding the applicable rate of service tax on advance payments received, specifically whether the rate should be 10% or 12% for services rendered on or after February 24, 2009. Two responses were provided. The first response questioned whether the applicable rate should be based on the date the service was rendered or the date the invoice was issued. The second response clarified that since the services were rendered on or after February 24, 2009, the applicable rate would be 10% as per the notification dated February 24. (AI Summary)