Applicability for service tax registration

[Guest]

If I start courier service whiat is the limit of turnover when I should register my courier service for SERVICE TAX, and what are the rates of SERVICE TAX.

[Mukesh Kumar]

All the dependent upon the facts that whether you were providing any taxable services prior to starting a new service of courier. If the answer is yes, you need to club the turnover of all the services and examine the situation. If the answer is no, you need to ascertain that you are eligible for small service provider (SSP) exemption upto 10 lacs. For this purpose you are advised to look into the notification no. 5/2006. The rates of service tax at present is 10% plus eduction cess and secondary and higher eduction cess equal to 3% i.e. aggregate rate of service tax is 10.3%. Earlier it was 12% + 3% i.e. 12.36%.

AI Summary

Service tax registration: club turnover of all taxable services for threshold assessment and apply small-service-provider exemption where applicable. Applicability of service tax registration for courier operations depends on whether other taxable services are already provided; if so, turnover of the courier activity must be clubbed with turnover of existing taxable services to determine liability. Where no prior taxable services exist, an operator may qualify for the small service provider exemption under the relevant notification and should verify eligibility against that notification. Service tax comprises a base rate plus an education cess and a secondary and higher education cess, producing an aggregate effective rate.