threshold exemption in case of abatement

[AMARISH TIWARI]

Dear Sir,

My client is a transporter , he can claim abatement of 75%, He has just taken  service tax registration,  number, how should i caculate threshold limit of Rs.10 Lac?

He will come in tax after turnover of 10  lac or after turnover of 40 Lac( because he will claim 75% abatement that will come to 30 Lacs, then he will claim threshold exemption Rs. 10 Lacs.as per my point of view)

thanking you

CA>Amarish Tiwari

AI Summary

Threshold calculation for small service provider exemption uses gross receipts before abatement, triggering liability when exceeded.
Calculation of the small service provider threshold exemption is based on gross receipts/payments received before any abatement; the provider becomes liable once gross receipts exceed the exemption limit, not when net value after abatement reaches that limit, and consecutive payments in a financial year are summed until the aggregate equals the exemption ceiling.