10 Points to learn everything about Service Tax Registration
by Paras Mehra 3.23K
Service tax registration is one of the prime steps towards starting your business. It provides an additional edge to you in the field of competing for business. To make you understand properly, we have designed 10 points on service tax registration that you must be aware off:
Here are the 10 points towards the registration:
- Service tax is an indirect taxes levied on the services rendered by any person in India against a consideration. Indirect taxes means the burden of the tax does not fall on the person who is liable to pay.
E.g. Restaurant is liable to pay the service tax on the services provided to the government, but it collects the same from the customers.
- If you are into trading business, then you are not liable for service tax. However, if you are doing both i.e. providing service as well as the trading or manufacturing, then you will fall under the service tax ambit. E.g. restaurant business, construction business, etc.
- The rate of service tax is 15% (w.e.f 1 June 2016 the rate is 15% on account on the increase due to the addition of 0.50% Krishi Kalyan Cess).
- A Service provider is liable for service tax collection and payment and hence, in case Service Provider is not able to collect it from the customers, then he needs to pay the taxes from his pocket.
- SSI exemption to small scale service provider helps them to avoid the legal compliances of this tax. The basic threshold limit for service tax is as under:
|
CASE |
ACTION REQUIRED |
|
Service are below 9 lakh |
No Action Required |
|
Services exceed 9 lakh |
Registration Required but not liable to Service tax |
|
Services Exceeds 10 Lakh |
Liable to Service Tax |
- Service tax is paid on the monthly or quarterly basis. This parameter is decided by the form of business you take. E.g. if you are a private limited company, then you need to pay service tax on the monthly basis.
Hence, to avoid any problem in this regard, we have summarised the complexities of this clause in a very simple manner:
|
FORM OF BUSINESS |
DUE DATE |
|
Individual, Proprietorship, Partnership, Hindu Undivided family and LLP (Limited Liability Partnerships) |
Quarterly (April to June – Q1, July to September – Q2) |
|
One Person Company (if turnover is 50 lakh or less in previous financial year) w.e.f 1st April, |
Quarterly |
|
Private Limited Company, Public Limited Company, Foreign Company or any other business form like Trust, etc |
. Monthly |
|
One Person Company (If turnover exceeds 50 lakh) |
Monthly |
- Due dates of service tax depends upon the form of business you take. We have summarized the table for both the persons paying service tax in quarterly or monthly basis:
- Chart for Companies with monthly payments:
|
MONTHS - PERIOD |
DUE DATE |
|
April |
6th of May, |
|
May to Feb, |
6th of Next Month |
|
March, |
31st March, |
- Chart for Companies with Quarterly payments:
|
QUARTERLY - PERIOD |
DUE DATE |
|
April to June, – Q1 |
6th of July |
|
July to September, – Q2 |
6th of October |
|
October to December, – Q3 |
6th of January |
|
January to March – Q4 |
31st March 2016 |
- An Exporter of Services is also liable for service tax registration. When you are exporting the services, then you should apply for service tax registration.
- Service tax Return is filed on a half yearly basis and the due dates of filing the service tax returns are as follows:
|
Period |
Due date for ST return filing |
|
April to September |
25 October |
|
October to March |
25 April |
- Recognition Under GST, once you are registered under service tax, then you will automatically deem to be registered under GST Act, and you will granted provisional certificate of registration for six months.
Then after submitting some requisite documents, you can get the final registration copy under GST.
Conclusion
We highly recommend you to apply for service tax registration, because it cost less with lesser compliances.
In the case of any query, please drop the query on the contact form.