Charging of service tax - Threshold limit, Service Tax

[rajesh marwaha]

An assessee having a turnover of Rs. 7.50 Lacs in the financial year 2006-07 was charging and depositing Service Tax. Now the Threshold limit has been increased to 8.00 lacs. Should the Assessee stop charging Service Tax w.e.f. 1.4.2007?

Posts / Replies

[Madhukar N Hiregange]

In your query turnover = value of taxable servcies provided. If so then he is eligible for exemption upto Rs.8 lakhs in the current year of taxable servcies recived. Once the same is exceeded he is exected to charge and collect the servcie tax.

[Vijay Chitte]

YES, As per Notificaiton-6/2005 the aggregate value of taxable services rendered by a provider of taxable service from one or more promises, does not exceed rupees four lakhs, (FROM 01/04/07 LIMIT IS EIGHT LAKHS)IN THE PRECEEDING FINANCIAL YEAR. As per your query your turnover does not exceeding EIGHTY LAKHS in F.Y. 2006-07, therefore you are liable for exemption in current f.y. Vijay Chitte - Claris