which ratio should take for distributing service tax credit through ISD.

[Guest]

Res. Sir,

we are manufacturer and having more than 3 excisable units ...we are receiving service tax credit invoices in the name of Head Office Address ..if i want to distribute this service in all excisable units so

let me know that which ratio should consider while i am distributing service ..

for example in july-2014 i want to take service tax credit which are booked in Head office through ISD so which ratio will be considered ?

AI Summary

Service Tax Credit Distribution: Follow Rule 7 of CENVAT Credit Rules, 2004 for Input Service Distributor Allocation Based on Turnover. A manufacturer with multiple excisable units inquired about the appropriate ratio for distributing service tax credit through an Input Service Distributor (ISD). The response highlighted Rule 7 of the CENVAT Credit Rules, 2004, which mandates the distribution of common input service credit among all operational units based on their turnover ratio from the relevant period. It was advised to thoroughly review Rule 7 before proceeding. Additionally, a recent circular provided further clarification on this distribution method.