Service Tax on Job work

[AMIT JAIN, Advocate]

Sir if the contract is not written when how can i compute service tax. actually my client is a book binder. he is bind the book of our client on the pre order basis and payment receive monthly, there is no contract in written formate.

[CASeetharaman KC]

There is no hard and fast requirement that a contract has to be written. You can still compute service tax on the amounts received monthly and disburse the same after checking whether your client has crossed the threshold limit etc. 

[YAGAY andSUN]

Yes, the threshold limit will play a vital role in determination of the liability of service tax.

AI Summary

Service tax liability: unwritten contracts still taxable; assess on monthly receipts subject to threshold limit. A written contract is not required for service tax to apply to job work; compute service tax on amounts received for the services and determine liability by checking whether the aggregate receipts cross the prescribed threshold limit, and if so, discharge service tax on those receipts.