The Service Tax Rate applicable from 1st June
2015 is 14%. This rate is an inclusive rate and SHEC and Education Cess is not
required to be charged above this.
This Tax is required to be deposited on a
Monthly/Quarterly basis. It can be paid either by manually depositing in the
Bank or through Online
Payment of Service Tax. In case, of excess payment of Tax by the Service
Provider with the Governement, the Service Provider can either adjust the
excess amount paid or can claim Refund of the Excess Tax deposited. Refer: Service Tax Refund
Case Study
Let’s understand via simple case, If a Chartered
Accountant, provides services in the capacity of auditor to ABC Ltd. and the
audit fees is Rs. 1,00,000 then the service tax chargeable will be 14% on Rs.
1,00,000 i.e. INR 14,000. Hence, the total billing to be done by CA to ABC Ltd
will be INR 1, 14,000.
The segregation of Value of Service Provided
(i.e. Rs. 1,00,000) and the Tax payable thereon (i.e. Rs. 14,000) shall be
separately showing on the Invoice.
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