Basic Exemption of Rs.10 Lakhs in Service Tax

[SANJAY BAHETI]

I want to know that basic exemption limit of rs. 10 lakhs in service tax is to be seen every financial year. or is it that once you crossed 10 lakhs limit, you have to pay service tax even though in next financial year amount is below rs. 10 lakhs. ? pls provide reference also.

[CAGOPALJI AGRAWAL]

The turnover of the preceding year only is to be considered. If turnover is below 10 lac in preceding year then exemption may be claimed again

[rajkumar shukla]

I agree with above reply.

i also agree with the same

[jayaprakash jagirdar]


I  ALSO  AGREE  WITH  THE SAME.

[NEERAJ KUMAR, RANCHI]

In addition to what has been said above, I wish to say with reference to your question that once your cross the limit of Rs 10 Lakh, only next year you will not be entitled for any exemption. Again if your turnover is less that Rs 10 Lakh in a year  the next year you will be entitled for exemption.

[KIRTIKUMAR PUROHIT]

Reply of Niraj Kumar is most proper, 10 Lac limit of  Exemption is available in basis of turnover limit of preceding finanacial year that means any year limit within the 10 lac in that case exemption is available next financail year.

[RAM SHARMA]

will we do include service tax amount in 10 laks limit for asess service tax liability.

Thanks  

AI Summary

Service tax exemption threshold is governed by preceding-year turnover; entitlement depends on prior-year turnover status.
Entitlement to the basic exemption limit for service tax is determined by the preceding year turnover: if the preceding year's turnover is below the threshold the exemption is available in the current year, and if the preceding year's turnover exceeded the threshold the exemption is not available for the current year; a year with turnover below the threshold restores entitlement for the next year.