Invoice under Service Tax

[Ganeshan Kalyani]

Issue of Invoice under Service Tax As per Rule 4A(1) of Service Tax Rules, 1994 every person providing a taxable service is required to issue an invoice or bill signed by such person or a person authorized by him in respect of taxable service provided or to be provided by him and such invoice or bill, as the case may be.   The invoice, bill or challan must be issued within thirty days from date of completion of taxable services or receipt of any payment towards the value of such taxable services, whichever is earlier. In case of banking and other financial services, they can issue invoice within 45 days as per rule 4A(1) as amended w.e.f. 01.04.2012. Invoice, bill or challan is required to be issued even when advance is received, even if service is to be provided later.  

Details required to be shown in invoice/bill/challan – As per rule 4A(1), the invoice/challan/Bill should be

(a) signed by authorized person of provider of input services

(b) should be serially numbered and

(c) should contain following details – Name, address and registration number of person providing taxable services Name and address of person receiving taxable service Description and value of taxable service provided or agreed to be provided and Service tax payable on the taxable service The service tax collected must be shown separately in Invoice/Bill raised by the person providing services.  

Invoice in case of continuous supply of service : -

Some services like construction services, telephone services, renting services are provided for a continuous period exceeding three months. The provision provides that in case of continuous supply of service, every person providing such taxable service shall issue and invoice, bill or challan, as the case may be, within thirty days of the date when each event specified in the contract, which requires the service receiver to make any payment of service provider is completed.  

Invoice when advance is received: -

As per Rule 4(A) of Service Tax Rules provides that every person providing taxable service shall issue an invoice, bill or challan within 30 days from the date of completion of such service or receipt of any payment towards value of taxable services, whichever is earlier. Invoice is required even when advance is received.

Digitally signed invoice: -

In the Union Budget 2015, an option to maintain records in electronic form and authenticate the same by digital signature subject to conditions, safeguards and procedures prescribed by the Board was given to the assessee. Subsequent to the provision an instruction is given for the manner of verification of the electronic records by the department is given vide Circular No. F. No. 224/44/2014-CX.6 dated 6th July, 2015. At present the maintenance of record in electronic form is an optional.  

(The above article is authored by Ganeshan Kalyani and he can be reached via email on [email protected]).

Discussions to this article

[Ganeshan Kalyani]

The service provider should follow the provision. also the recipient of service should also ensure that when he receives the invoice it should contain all the above requirements.