joel.francis.7351
Par 100 posts (V.I.P)
Service Tax revised to 14% .. What does this mean for you?
If you are a Service Provider:
- For all Invoices dated up to 31st May 2015, the applicable rate of service tax shall be 12% Basic + 2% Education Cess + 1% Sec. & Higher Education Cess i.e. a total of 12.36%
- For all invoices dated 1st June 2015 and beyond the applicable rate of service tax shall be 14% inclusive of both the Education and Higher Education Cess.
- An additional 2% of Swachh Bharat Cess shall be applicable on certain services to be notified at a later date
If you are a Service Recipient:
- Your service provider shall charge the revised rate of Service Tax for all Invoices post 1st June 2015.
- Some service providers are ignorantly charging 14% Service Tax from 1st April 2015. This is incorrect and revised invoices should be sought for such cases. For Invoices between 1st April and 31st May 2015 the effective rate shall remain 12.36%
- Where Reverse Charge Mechanism is applicable, the service recipient shall calculate and pay the revised rate of Service Tax for all Invoices dated 1st June 2015 onwards.
If you are a Service Provider:
- For all Invoices dated up to 31st May 2015, the applicable rate of service tax shall be 12% Basic + 2% Education Cess + 1% Sec. & Higher Education Cess i.e. a total of 12.36%
- For all invoices dated 1st June 2015 and beyond the applicable rate of service tax shall be 14% inclusive of both the Education and Higher Education Cess.
- An additional 2% of Swachh Bharat Cess shall be applicable on certain services to be notified at a later date
If you are a Service Recipient:
- Your service provider shall charge the revised rate of Service Tax for all Invoices post 1st June 2015.
- Some service providers are ignorantly charging 14% Service Tax from 1st April 2015. This is incorrect and revised invoices should be sought for such cases. For Invoices between 1st April and 31st May 2015 the effective rate shall remain 12.36%
- Where Reverse Charge Mechanism is applicable, the service recipient shall calculate and pay the revised rate of Service Tax for all Invoices dated 1st June 2015 onwards.