NOTE: NOW THIS IS MERGED IN GST REGISTRATION
Service Tax Registration is a tax registration required for businesses providing services in India. Service tax registration is an indirect tax wherein the service provider pays the tax and recovers the same from the recipient of the taxable service. At present, Service Tax is levied at 12.3% on the value of the taxable service. This includes Education Cess @ 2% on the service tax amount, and Secondary and Higher Education Cess @ 1% on the service tax amount.
Service Tax registration is mandatory for every person or business in India that has provided a taxable service of value exceeding Rs.9 lakhs, in the previous financial year. Service Tax Registration is required for identification of the assesse, deposit service tax, file service tax returns and undertake various processes required under the Finance Act, 1994. Failure to obtain service tax registration would attract penalty in terms of section 77 of the Finance Act, 1994.
Service Tax Registration Process
Step 1: Service Tax Registration
You can obtian Service Tax Regisration in 7 to 12 days, subject to Government processing time.
Step 2: Application Preparation
A Tax Expert will prepare your Service Application and obtain your signature in the format along with the necessary supporting documents.
Step 3: Application Processing
Once the application is prepared, you will obtain ST1 Registration and submit the hardcopy Application with supporting documents to the concerned Tax Department.
Step 4: Service Tax Registration
Once the Service Tax Application and the attached supporting documents are verified, the Tax Department will allot Service Tax Regisration (ST2) for your business.
Frequently Ask Questions (FAQs)
|1||What is Service Tax?|
|Service tax is a tax on services provided in India. Service tax is levied under the Finance Act, 1994 on certain services as specified by the Government.|
|2||Who has to pay Service Tax?|
|Service tax is to be paid by the receiver of the service. However, service tax is a form of indirect taxation. Therefore, the person who provides the taxable service on receipt of service charges along with the service tax is responsible for paying the service tax portion to the Government. Also, small scale service providers who provide less than Rs.10 lakhs of taxable service a year is exempt from service tax.|
|3||What are taxable services?|
|Almost all services provided in India are taxable. To find the complete list of taxable services, refer to Section 65(105) of the Finance Act, 1994. All taxable services as on 1.5.2011 is listed in Appendix-1.|
|4||What is the rate of Service Tax?|
|The effective rate of Service Tax is 10.3% on the value of the taxable service. In addition education cess @ 2% on the service tax amount and secondary and higher education cess @1% is levied on the service tax amount. Hence, Service Tax is normally levied at 12.36%|
|5||What is service tax registration?|
|Service tax registration is a mandatory registration for service providers who have taxable service of value exceeding Rs.9 lakhs, in the previous financial year. Service tax registration facilitates in the identification of assesse, payment of service tax and filing of service tax returns.|
|6||Who must obtain service tax registration?|
|Any person who has provided taxable service of value exceeding Rs.9 lakhs in the preceding financial year is required to obtain service tax registration. When a person commences a new business, he/she is required to obtain service tax registration within 30 days of commencement, if the business will have taxable service in excess of Rs.9 lakhs.|
|7||What are the documents required for service tax registration?|
|To obtain service tax registration, a copy of PAN Card, proof of address of business and constitution of the business [Partnership deed, Incorporation Certificate, etc.,] is required.|
|8||How long does it take to obtain service tax registration?|
|Service tax registration certificate must be issued by the Government within a period of seven days from the date of submission of application ST-1 along with all the relevant documents. In case the registration certificate is not issued within seven days, the registration applied for is deemed to have been granted.|
|9||What is the penalty for not obtaining Service Tax Registration?|
|Failure of registration may attract a penalty of upto Rs.10,000/- or Rs.200/- for every day during which the failure continues, whichever is higher.|
|10||How to pay Service Tax?|
|Service tax payments can be made at specified branches of designated banks. The list of designated banks can be obtained from the Central Exicise or Sales Tax office. Sales tax payments should be made using Form G.A.R.7.|
|11||When should Service Tax payments be deposited?|
|Service tax payments must be deposited by Proprietary Firms and Partnership Firms quarterly. Companies, Societies, Trust, etc., are required to make service tax payments monthly.|
|12||When should Service Tax Returns be filed?|
|Service Tax Return ST-3 must be filed twice in a financial year. Return for half year ending 30th September and 31st March are required to be filed by 25th October and 25th April, respectively.|
Service Tax Highlights
Small Scale Service Providers:
Small scale service providers who provide taxable services of less than Rs.10 lakhs in a year is wholly exempted from service tax and service tax registration.
Service Tax Registration:
Service tax registration must be obtained by any person who provided a taxable service of value exceeding Rs.9 lakhs, in the previous financial year. Failure to obtain service tax registration can result in penalty
Service Tax Return Filing:
Service Tax Return Form ST-3 must be filed twice in a year. Return for half year ending 30th September and 31st March are required to be filed by 25th October and 25th April, respectively.
Service Tax Payments:
Service Tax Payments must be deposited in designated banks quarterly in case of Proprietary Firms or Partnership Firms and monthly in the case of Companies, Trusts, Societies, etc.
NO Service Tax on Exports:
For services exported from India, service tax is not applicable. Therefore, exporters of service are not required to pay service tax. However, it is advisable for service exporters to obtain service tax registration.
Capacity to sue and be sued:
To sue means to institute legal proceedings against or to bring a suit in a court of law. Just as one person can bring a legal action in his/her own name against another in that person’s name, a company being an independent legal entity can sue and also be sued in its own name.
In case Form ST-2, Registration of Service Tax is not issued within seven days of filing of Form ST-1 with all the relevant documents, the service tax registration is automatically deemed to be granted.
- Service Tax Registration ,
- Service Tax Registration Process