Calculation of SHEC

[Asked by Guest]

SHE cess is effective on service tax from 11.5.07. In respect of quarterly AMC payments for the period Apr-Jun'07, the bills raised and amount received in Apr'07 and hence tax paid @ 12.24%. In the light of new SHE cess effective 11.5.07, whether SHE cess is to be paid proportionately on the tax on charges relatable to the period 11.5.07 to 31.5.07? If so, how could the amount be shown in the returns?

AI Summary

SHE cess on service tax applies proportionately to the taxable period and must be collected, deposited, and disclosed in returns.
The SHE cess applies proportionately to the portion of service tax attributable to the period after the cess commenced; advance receipts must be broken up to identify the cess liable portion. Collect the incremental cess from the recipient where feasible, deposit it within the prescribed remittance period, and disclose it in the service tax return-showing amounts paid as "arrears of tax paid" and annotating the return that the cess has been included.