TaxTMI 
TaxTMI 
What wil be the rate of tax if services are provided before 1 july and payment is received after 1 july?
Rate of Tax
23 Aug 2012 
5 Replies 
1266 Views Asked by
Service tax timing rule: timing of invoice, payment or provision determines applicable rate; limited stay applies for professionals.
The applicable service tax rate is determined by the timing of invoice issuance, payment receipt and provision of service under a Two-Event Test: if two of these events occur before the effective date the earlier rate applies, and if two occur after the effective date the later rate applies. The department clarified application of the later rate where two events fall after the effective date, while a judicial stay on the additional component has been recorded for certain professionals. (AI Summary)
The applicable service tax rate is determined by the timing of invoice issuance, payment receipt and provision of service under a Two-Event Test: if two of these events occur before the effective date the earlier rate applies, and if two occur after the effective date the later rate applies. The department clarified application of the later rate where two events fall after the effective date, while a judicial stay on the additional component has been recorded for certain professionals. (AI Summary)