Software development

[Guest]

Sir,

What is the tax to be levied on software development? What are the circumstances in which only Service Tax is applicable and only Sales tax is applicable? Whether there are any circumstances where both the taxes are applicable?

[KASTURI SETHI]

Reply to your all queries on this issue is available on google. Both Service Tax and VAT are applicable depending on the usage and mode of sale. Post the question, "Whether Service Tax is applicable on software development ?" Central Excise duty has been exempted. This also falls under Chapter 85 of Central Excise Tariff Act.

[Himansu Sekhar]

You are correct kasturi sir.

[Ganeshan Kalyani]

I think we are Google for them. The data available in Google is not authenticated by expert. Whereas expert in TMI answers in a simple manner and with reference to law. This suffice their need and solves their issue.

However i do agree with your views as well because the querist is not a novice.

[KASTURI SETHI]

Sh.Ganeshan Kalyani Ji,. I agree with you. There is a very good article by Sh.Singhal CA on some site which solves all the situations described by the Querist.

AI Summary

Understanding Tax Implications for Software Development: Service Tax, VAT, and Central Excise Duty Exemptions Explained A user inquired about the applicable taxes on software development, questioning when service tax, sales tax, or both are relevant. A respondent suggested that both Service Tax and VAT might apply based on the usage and sale mode, noting that Central Excise duty is exempted under Chapter 85 of the Central Excise Tariff Act. Another participant agreed, while a third emphasized the value of expert advice over general online information, citing a useful article by a chartered accountant that addresses the query comprehensively. The discussion highlights the importance of expert guidance in understanding tax implications.