E2-E3 Financetraining.bsnl.co.in/digital_library_source/upgradation/E2...For internal circulation of...
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For internal circulation of BSNL only
E2-E3
Finance
Indirect Taxes
WELCOME
This is a presentation for the E2-E3
(Finance) Core Module for the Topic:
Indirect Tax .
Eligibility: Those who have got the Up
gradation from E2 to E3.
This presentation is last updated on 21-3-
2011.
You can also visit the Digital library of
BSNL to see this topic.
For internal circulation of BSNL only
For internal circulation of BSNL only
AGENDA
Salient features of Service Tax
Registration
Payment of Service Tax
Various Penalties
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Service Tax – Salient features
Service tax is under Sec-66 of Finance
Act,1994.
Rate – 12% + EC + SAH Education cess. Total
Service Tax is 12.36% from 11-05-2007. From
24-02-2009 Service Tax is 10% and total Service
Tax is 10.30% including Education Cess
For internal circulation of BSNL only
Service Tax – Salient features
Person who is providing taxable
service is liable to pay Service tax.
TDS will be on the gross amount
including Service tax and education
cess.
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Service Tax – Salient features
Small service providers whose turnover less
than Rs.10 lakhs per annum are exempt from
Service tax.
No Service Tax on service provided in J&K.
Service Tax is payable in the value of taxable
service and not value of entire value of
contract
For internal circulation of BSNL only
Service Tax – Salient features
If gross amount is inclusive of
Service Tax, value of taxable service is
calculated by back calculation.
Service Tax & Education Cess have to
be rounded off individually.
Service Tax is for the net amount of services
excluding VAT/Sales Tax.
Service Tax is on the net amount after
discount etc.
For internal circulation of BSNL only
Exemption from Service Tax
Small service providers
Export of services
Services provided by any person to United
Nations or any other internationl organisation
Service provided by RBI
Service rendered to developer of SEZ
Services rendered to a unit in SEZ
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Exempted Services in BSNL
Departmentally run public telephone for local
calls.
Guaranteed public telephone operating only
for local calls.
Free Telephone at Airport and Hospital where
no bills are issued
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Specific exemptions of Service Tax( Certain cases)
Goods Transport
Agency (GTA)(No Service Tax for the
transportation of fruits,
vegetables, eggs or milk )
Tax only on 25% amount in his
invoice ( Payment will be
made by consignor/ consignee
who is actually paying freight)
Outdoor caterer Tax on 50% amount if he
provides full and substantial
meal
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Specific exemptions of Service Tax( Certain cases)
Package tours &
other than package
tour
Tax is payable only on 40%
of gross amount charged
Rent-a -cab operator Tax payable on 40% of gross amount charged
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Registration
Persons providing taxable service in excess of
Rs.9 lakhs
Input service distributors
Persons liable to pay service tax on the services
received
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Registration
Centralised Registration is required if a
person paying Service Tax has
Centralised Billing systems or Centralised
Accounting systems
Such centralised billing system of centralised
Accounting systems are located in different
premises
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Registration
A person should register within 30 days from
the date of commencement of the business of
providing taxable service
Person providing more than one taxable
service is required to take only one single
registration. He should indicate all taxable
services provided by him in Form ST-1
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Registration
Apply in Form ST-1 along with the
following documents:
1. Copy of PAN,
2. Proof of residence
3. Constitution of applicant
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Registration
Registration certificate in Form ST-2 within 7
days.
Deemed registration
Registration No is a 15 digit - PAN based
(PAN + alpha-code (ST) + Numeric code)
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Invoice by service provider
Invoice should be prepared within 14
days from date of completion of taxable
service or receipt of payment towards
the value of taxable service, whichever
is earlier
The invoice/ challan/ bill should be
(i) signed by authorised person.
The invoice/ challan/ bill should be
(ii) serially numbered
For internal circulation of BSNL only
Invoice by service provider
The invoice should contain-Name, address and registration number of
person providing taxable service
Name and address of person receiving
taxable service
Description, classification and value of
taxable service provided or to be provided
Service tax and education cess should be
shown separately
For internal circulation of BSNL only
Persons liable to pay Service Tax
In most cases, service provider
Exception:
Taxable service provided by any person
from a country other than India
In case of services of GTA
In case of sponsorship service
provided to a body corporate or firm.
For internal circulation of BSNL only
Payment of Service Tax
Service tax is payable on 5th of the following
month
For the month of March the payment is to be
made by 31st March
e-payment is mandatory by all assesses who
have paid Service Tax of Rs.10 L or more
For internal circulation of BSNL only
Payment of Service Tax
Amount collected as Service Tax must be
paid to Government.
Any amount collected as Service Tax though
it is not required to be collected shall be
deposited to Government.
For internal circulation of BSNL only
Interest on late payment of Service tax
Interest rate is 13% w.e.f 10-09-2004
Interest payment is automatic
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Demand and Interest
Any service tax not levied or short-levied or
short-paid or erroneously refunded, the
Central Excise officer may, within one
year from the relevant date, serve show
cause notice
Proviso is 5 years in the case of fraud,
collusion, willful mis-statement, suppression
of facts, etc.
For internal circulation of BSNL only
Returns
Half yearly returns in Form- ST3 in triplicate
within 25 days of end of half year
(1st April to 30th Sept & 1st Oct to 31st Mar)
Accompanied by TR 6 Chellan
Separate return for each taxable service
For internal circulation of BSNL only
Late fee for late filing of returns
Delay up to 15 days - Rs.500/-
Delay up to 30 days - Rs.1,000/-
Delay beyond 30 days – Rs.1,000 + Rs.100/-
per day of delay beyond 30 days, maximum
Rs.2,000/-
If return not filed within the period , penalty
is leviable up to Rs.5,000/- under section 77.
Can be waived for reasonable cause under
section 80.
For internal circulation of BSNL only
Penalties for non-payment or delayed payment
Penalty shall be minimum Rs.200/- per day
during which such failure continues or @ 2%
per month whichever is higher, starting with
the first day after due date till date of actual
payment outstanding amount.
For internal circulation of BSNL only
Penalty for non-registration
Rs. 5000/- or Rs.200/- per day during which
the failure continues whichever is higher,
starting with the first day after the due date,
till the date of actual compliance
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Penalties - General
Failure to keep , maintain or retain books of
account and other documents as required –
Rs.5,000/-
Failure to furnish information called for,
failure to produce documents called for ,
failure to appear before Central Excise officer
– penalty of Rs.5,000/- or Rs.200/- for every
day during which failure continues,
whichever is higher.
For internal circulation of BSNL only
Penalties - General
Failure to make e-payment – Penalty of Rs.5,000/-
Any person who issues invoice with incorrect or
incomplete details or fails to account for an invoice in
his books of account - Penalty Rs.5,000/-
Penalty for contravention of any provision of the rules
can be up to Rs.5,000/-
For internal circulation of BSNL only
Appeals
If adjudication order is passed by authority
lower than commissioner of Central Excise, first
appeal will be with Commissioner (Appeals)
under Sec 85(1) within 3 months from date of
receipt of order of adjudicating authority.
Second and final appeal is with Appellate
Tribunal (CESTAT) under section 86(1) within 3
months
Appeal is in form ST-5 in quadruplicate
For internal circulation of BSNL only
BSNL InstructionsService Tax registration Number and PAN of
BSNL are printed on the Telephone bills/
demand notices/invoices, challans etc.
The amount of Service Tax is calculated on the
total amount of telephone bill before adjustment
of excess/double payment/deposit etc.
OYT connections, Service Tax is calculated on
the rent payable before allowing OYT rebate
No Service Tax on the surcharge
For internal circulation of BSNL only
BSNL Instructions
Service tax from 01-06-2007
Interconnect usage charges (IUC)
Port charges
Infrastructure charges
Rental for junction links (charges for
junction links of BSNL form one exchange
to another)
For internal circulation of BSNL only
BSNL Instructions
No Service Tax on USO claim amount of BSNL
Service Tax is applicable on Access Deficit
Charges
Service Tax is applicable on TA/DA and
reimbursement of expenditure to CAs for the
discharge of duties in their professional
capacity for BSNL
Service Tax to hiring of cabs payable only
when they got service tax registration
For internal circulation of BSNL only
BSNL Instructions
Incidence of Service tax on renting of
immovable properties
Service Tax is payable by BSNL towards
payment of rent by BSNL for space hired for
Roof Top Towers/Ground Based Towers
No Service Tax is leviable towards renting of
vacant staff quarters on rent to Central/State
PSUs by BSNL and also renting of community
halls to employers/others by BSNL
For internal circulation of BSNL only