Registeration and Taxability

[vignesh VSACCOUNTOPRIVATELIMITED]

Sir one of my client has registered under service tax in April 2015 and he has received rent from commercial property ₹ 20.00 Lakhs and he has started paying service tax after Crossing ₹ 10.00 Lakhs only on the assumption that, the first 10.00 lakhs is not liable for tax and he has not charged from the client too. is that correct? can u give any notifications for the same!

[Shilpi Jain]

Only in the first year he crosses 10L he would not be liable to ST on the 10L. Next year onwards liability will exist on entire 20L

[Ganeshan Kalyani]

Sir, in the first year of registration the threshold exemption of ₹ 10 lacs is available. That means you have to pay service tax on amount above ₹ 10 lacs. In the next year, since registration is already there, service tax is to be charged right from first invoice.

[KASTURI SETHI]

I agree with both experts. In this context, pl. refer to Notification No.33/12-ST dated 20.6.12 (effective from 1.7.12) (Clause No. viii refers.). Relevant extract of notification is appended below:

Provided that nothing contained in this notification shall apply to,-

(viii) the aggregate value of taxable services rendered by a provider of taxable service from one or more premises, does not exceed ten lakh rupees in the preceding financial year.

Preceding means previous, coming before something in order.

[vignesh VSACCOUNTOPRIVATELIMITED]

Sir. 1. in a case where the previous year turnover was below 10 lakhs and for the current year the Rental income crosses 10 lakhs (ie 1. Bill.No.1. ₹ 9,35,000+ Bill.No. 2. ₹ 1,20,000/-) should we charge Service Tax for the last bill of ₹ 1,20,000/- or for an amount exceeding 10.00 lakhs i.e for ₹ 55,000/- alone 2. Registration is done on 30.09 2015 and client have an input service bill with Tax of ₹ 22,000/- dated 31.07.2015, can he claim the service tax portion after he starts filing Service Tax Returns and paying Taxes during the financial year 2015-2016?