TaxTMI 
TaxTMI 
Dear Sir
Is service tax applicable?, If we are taken demand draft charges from client and Demand draft is above ₹ 15 lacks in the financial year and charges taken is above ₹ 50000.00
Is service tax apllicable for Charges received on Demand Draft
16 Nov 2014 
1 Reply 
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Service tax on banking transaction charges applies to demand draft and similar fees, making banks liable for tax.
Banks must pay service tax on service charges for various money-related transactions, including charges for making demand drafts, issuance of letters of credit, guarantee charges, loan processing fees, cheque return charges, foreign exchange commissions, remittance charges and account maintenance charges; such transaction-based service receipts are taxable under regulatory guidance and should be treated as part of taxable services. (AI Summary)
Banks must pay service tax on service charges for various money-related transactions, including charges for making demand drafts, issuance of letters of credit, guarantee charges, loan processing fees, cheque return charges, foreign exchange commissions, remittance charges and account maintenance charges; such transaction-based service receipts are taxable under regulatory guidance and should be treated as part of taxable services. (AI Summary)