Software development

[Aitha RajyaLakshmi]

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?

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.