Service Tax Registration in case of Export of services

[Guest]

Hello,

My client is an exporter of services (fulfill all conditions of export of services). I have couple of questions regarding that as below:

1. Do the client need to take service tax registration mandatorily in case his export receipt from services exceeds 10 Lakhs?

2. In case he have 2 lakhs of domestic service receipt and receipt from export of services are more than 10 Lakhs, will there be any service tax applicable?

3. If Yes, is there any penalty for not registering and non-payment of service tax till date.

Looking forward to your expert comments.

Thanks

[Ganeshan Kalyani]

Export of service is not subject to service tax. So there is no need to get service tax registration . However , in view of claiming refund of the service tax that has been paid toward inward service may take registration .

[Guest]

Hi Ganeshan,

Thank you for your response.

I am getting other opinions where I am being adviced to take the mandatorily registration.

[Ganeshan Kalyani]

Service tax registration is required to pay tax and doing of filing of service tax return. In export of service there is no service tax liability . Also the provision states that an assessee shall register under service tax if he crosses the threshold limit. The export of service is outside the purview of tax. Hence , in my considered view service tax registration is not required in case of export of service.

AI Summary

Export of services is not subject to service tax, so registration is generally unnecessary though registration may enable input tax refunds. Export of services is not subject to service tax, so registration is not required solely on account of export receipts; however, an exporter may obtain registration to claim refund of service tax paid on inward services. Registration is required where a taxable service liability arises and where statutory threshold rules apply to taxable activities within the tax net, but export activity itself is treated as outside that net.