regn. exemption limit for

[sunil mehta]

New 'accomodation services' has become effective from 01/05/2011. Small to medium hotels provide some of their rooms  with 'declared tariff ' of Rs. 1000/- and above and some rooms below Rs.1000/-.i.e same hotel offers  two different  'published tariffs ' for different class of rooms.

 Facts:-

1)New service tax registration is due when ..'aggregate value of taxable service in a financial year exceeds  rs. 9 lacs ' (notfn. no. 26/2005 dt.07/06/2005.

Now ,'aggregate value....service ' means the sum total of first consecutive payments received during the financial year towards the gross amount..................but does not include payments received towards such gross amount which are exempt from thewhole of service tax leviable thereon under section. 66 of the said  Finance Act under any notification other than Notification No. 6/2005-Service Tax, dated the 1st March, 2005 .  '

Assuming that the service provider does not provide any other taxable service-

Query 1)Whether , for the purpose of Registration , taxable turnover would include 'declared tariff less than Rs.1000/- also ?

Query 2) Whether , for the purpose of paying service tax when service provider crosses Rs.10 lacs limit , the sum total of first consecutive payments recd. during the Fin. Year  would include both 'published tariff less than Rs.1000/- & 'published tariff of Rs. 1000/-or more ' ?or only 'published tariff of = or > rs.1000/- ? ( notfn. no. 8/2008 dt.01/04/2008 ) 

[Pl. see explanation B of notfn. 8/2008 dt.01/04/2008 ]

Pl. clarify (1) and (2) 

[RadheyShyam Mangal]

Answer to Query 1 -For the purpose of Registration , taxable turnover would not  include payment received for rooms/unit having  "declared tariff less than Rs. 1000/-  in view of exemption to such unit of accomodation in Notification No 31/2011 ST.

Answer to Query 2 --For the purpose of paying service tax when service provider crosses Rs.10 lacs limit , the sum total of first consecutive payments recd. during the Fin. Year  would include only payment received for rooms/unit having "published tariff of Rs. 1000/-or more . 

AI Summary

Accommodation service threshold: only receipts from rooms meeting published tariff criteria count toward registration and tax liability. Payments for rooms/units with a declared tariff below the published tariff threshold are excluded from taxable turnover for registration and for computing the sum of first consecutive payments; only receipts from rooms/units with a published tariff at or above the threshold are counted towards the aggregate value of taxable service that triggers registration and service tax liability.