Category: Tax FAQ

Last Date for Service Tax Return for Half Year Ending 31 March 2015 (For Oct 2014 to March 2015)

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Service Tax Return (ST-3)  for the half year  ending 31st March 2015 i.e. for period starting from October 2014 to March 2015 has been made available for e-filing by the assesses in both offline and  online version in ACES w.e.f 1st April, 2015. The last date of filing the ST-3 return for the said period is 25th April, 2015. Penalty for late filling is Rs 20,000/-

Service Provider can download the latest ST 3 Service Tax Half Yearly return for online filing of Service Tax return.  In case of any difficulty in accessing the ACES Application or in filing ST 3 returns, the assesses can seek help of the ACES Service Desk by sending e-mail to  or calling up national toll-free number 1800 425 4251.

Service Tax Return (ST-3) for the period from Oct’ 14 to March’15  is now  available for e-filing by the assesses. The last date for filing the returns for the said period is 25th April, 2015. The assesses can file return online or use the offline utility by downloading the latest version. Assessees are requested to file their returns in ACES well in advance to avoid rush and inconvenience at the last moment.

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New Service Tax Rate 14% +2% i.e. 12.36% to 14%+2% =16% New Effective Date and Rate

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Ministry of Finance of has issued the clarification related to the applicability of the new service tax rate of 14%+2%(Swachh Bharat Tax) total of 16% and as per the circular new rate and its applicable date will be notified by the government after the enactment of the Finance Bill, 2015 i.e. after budget is passed by the parliament and assented by the President of India and possible date will be between 20th April to 25th April 2015 till then current rate of 12.36% will be applicable.

Circular No. 183 / 02 / 2015-ST

F. No. B-1 /1/2015-TRU
Government of India
Ministry of Finance
Department of Revenue
(Tax Research Unit)

***

Room No. 153, North Block, New Delhi.

Dated 10th April, 2015.

To
Chief Commissioner of Customs and Central Excise(All)
Chief Commissioner of Central Excise & Service Tax (All)
Director General of Service Tax
Director General of Central Excise Intelligence
Director General of Audit Commissioner of Customs and Central Excise (All)
Commissioner of Central Excise and Service Tax (All)
Commissioner of Service Tax (All) Madam/Sir,

Dear Madam/Sir,

Subject: Clarification on rate of service tax – regarding.

Doubts have been expressed in various forums regarding the proposed increase in the rate of service tax from 12.36% (including education cesses) to 14% on the value of taxable service.

2.         It may be noted that changes proposed in the Budget have/are coming into effect on various dates as already indicated in JS (TRU-II) D.O. letter dated 28th February, 2015. Certain amendments made in the Finance Act, 1994, including the change in service tax rate, will come into effect from a date to be notified by the Government after the enactment of the Finance Bill, 2015.

 3.        In this regard your attention is invited to clause 106 of the Finance Bill, 2015 and paragraph 3 of JS (TRU-II) D.O. letter, which  is reproduced below:-

“3. Service Tax Rate:

3.1       The rate of Service Tax is being increased from 12% plus Education Cesses to 14%. The ‘Education Cess’ and ‘Secondary and Higher Education Cess’ shall be subsumed in the revised rate of Service Tax. Thus, the effective increase in Service Tax rate will be from the existing rate of 12.36% (inclusive of cesses) to 14%, subsuming the cesses.

3.2       In this context, an amendment is being made in section 66B of the Finance Act, 1994. Further, it has been provided vide clauses 179 and 187 respectively of the Finance Bill, 2015 that sections 95 of the Finance Act, 2004 and 140 of the Finance Act, 2007, levying Education Cess and Secondary and Higher Education Cess on taxable services shall cease to have effect from a date to be notified by the Government.

3.3       The new Service Tax rate shall come into effect from a date to be notified by the Central Government after the enactment of the Finance Bill, 2015.

3.4       Till the time the revised rate comes into effect, the ‘Education Cess’ and ‘Secondary and Higher Education Cess’ will continue to be levied in Service Tax.”

4.         The paragraph reproduced above is self-explanatory and it is clear that the new Service Tax rate shall come into effect from a date to be notified by the Central Government after the enactment of the Finance Bill, 2015. The date will be notified in due course after the enactment.

5.         Similarly, certain doubts have been raised with regard to abatement on value of services provided in relation to serving of food or beverages by a restaurant, eating joint or a mess, having the facility of air-conditioning or central air-heating in any part of the establishment, at any time during the year. Valuation of services provided in relation to serving of food or beverages by a restaurant, eating joint or a mess is determined as provided in rule 2C of the Service Tax (Determination of Value) Rules, 2006.

5.1       In the Union Budget, 2015, no change has been made in these rules; therefore, any confusion is unwarranted. Further, as explained above, the rate of service tax on the specified portion of the amount charged for such supply which is 40% continues to be 12.36% (includingcesses) at present i.e. 4.944 %. The rate of Service tax, as discussed above, will continue unchanged till a date which will be notified in due course.

6.         Wide publicity may be given so that the assesses and public are aware of the above.  All the major Industry/Trade Associations may be informed accordingly.

 

Yours sincerely,

(Dr. Abhishek Chandra Gupta)

Technical Officer, TRU

Tel: 011-23095547

Download Service Tax Half Yearly Return for the period April-September 2014: Due Date 25th October 2014

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Service Tax Return (ST-3)  for the period April -September 2014 has been made available for e-filing by the assesses in both offline and  online version in ACES w.e.f 1st October, 2014. The last date of filing the ST-3 return for the said period is 25th October, 2014.

Service Provider can download the latest ST 3 Service Tax Half Yearly return for online filing of Service Tax return.  In case of any difficulty in accessing the ACES Application or in filing ST 3 returns, the assesses can seek help of the ACES Service Desk by sending e-mail to  or calling up national toll-free number 1800 425 4251.

Service Tax Return (ST-3) for the period from April-14 to September-14  is now  available for e-filing by the assesses. The last date for filing the returns for the said period is 25th October, 2014. The assesses can file return online or use the offline utility by downloading the latest version. Assessees are requested to file their returns in ACES well in advance to avoid rush and inconvenience at the last moment.

Download (ZIP)

How to Update Mobile number & E-mail ID of Tax payers on e-Filing Portal of Income Tax India Website

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The process of updating and authenticating the contact details Mobile number & E-mail ID of Tax payers on e-Filing Portal of Income Tax India Website.

Updating Contact Details for FIRST TIME USER (NEW TAX PAYER) 

Provide the correct Mobile Number and Email ID during the Registration in the e-Filing portal, Activation link would be sent to the registered E-mail ID and a One Time Password (OTP also called PIN) is sent to the registered  Mobile Number. User needs to Click on the Link provided in the E-mail and  enter the OTP received in the mobile number for Successful activation of the  registered user in e-Filing portal.

Updating Contact Details for OLD USER (ALREADY REGISTERED TAX PAYER OR USERS) 

After the user logs in to the e-filing account, there will be a pop-up requesting the user to update the current Mobile number and E-mail ID. The user should update their personal Mobile number and Email so that the updated contact particulars are registered with the Department or confirm that the Mobile number and email ID already registered is their valid personal contacts.
Upon submitting the details, Department would immediately send OTPs  (PIN1 & PIN2) to new mobile number and Email ID. The respective PINs- PIN1 and PIN2 received through Mobile number and E-mail ID should be entered by them in the respective input fields to authenticate that the email ID and mobile are correct. Upon successful validation the Mobile number and email ID would be updated in the taxpayer’s profile and the process
would be complete.
The PIN1 and PIN2 would be valid only for the session – so taxpayers are advised not to close the webpage till PINs are entered and validated. In case of any difficulty or delay, the taxpayer can log in again and follow the same process to update the current contact details.

TDS on Service Tax Component: When indicated separately in Bill or Agreement

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CBDT has issued the circular related to deduction of tax i.e. TDS on service tax component. When service tax component in the amount payable to a resident is indicated separately then tax shall be deducted at source on the amount paid/payable without including such service tax component.

CIRCULAR NO. 1/2014 [F.NO.275/59/2012-IT(B)] DATED 13-1-2014
When service tax component in the amount payable to a resident is indicated separately then tax shall be deducted at source on the amount paid/payable without including such service tax component

The Board had issued a Circular No.4/2008 dated 28-04-2008 wherein it was clarified that tax is to be deducted at source under section 194-I of the Income-tax Act, 1961 (hereafter referred to as ‘the Act’), on the amount of rent paid/payable without including the service tax component. Representations/letters has been received seeking clarification whether such principle can be extended to other provisions of the Act also.
2. Attention of CBDT has also been drawn to the judgment of the Hon’ble Rajasthan High Court dated 1-7-2013, in the case of CIT (TDS) Jaipur v. Rajasthan Urban Infrastructure (Income-tax Appeal No.235, 222, 238 and 239/2011), holding that if as per the terms of the agreement between the payer and the payee, the amount of service tax is to be paid separately and was not included in the fees for professional services or technical services, no TDS is required to be made on the service tax component u/s 194J of the Act.
3. The matter has been examined afresh. In exercise of the powers conferred under section 119 of the Act, the Board has decided that wherever in terms of the agreement/contract between the payer and the payee, the service tax component comprised in the amount payable to a resident is indicated separately, tax shall be deducted at source under Chapter XVII-B of the Act on the amount paid/payable without including such service tax component.
4. This circular may be brought to the notice of all officer for compliance.

List of Authorised Banks for E-Payment of Income Tax: Banks for Online Tax Payment

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List of Banks authorized by Income Tax Department for collecting E-Payment of Income Tax .i.e Online Collection of Advance Income tax, Tax Deducted Source (TDS) and Self Assessment Tax under Income Tax Act through NSDL. Total 30 Indian Banks have been empanelled for online Tax Collection  for Payment of TDS on Sale of Property (Form 26QB), Tax Deducted at Source / Tax Collected at Source (TDS/TCS) from corporates or non-corporates TDS/TCS (CHALLAN NO./ITNS 281), payment of Income tax & Corporation Tax (CHALLAN NO./ITNS 280), payment of Security Transaction Tax, Hotel Receipts Tax, Estate Duty, Interest Tax, Wealth Tax, Expenditure Tax /Other direct taxes & Gift tax (CHALLAN NO./ITNS 282).

Following is the List of Banks for Online Tax Collection (Income Tax, Service Tax, Custom and Excise)

  1. Allahabad Bank
  2. Andhra Bank
  3. Axis Bank
  4. Bank of Baroda
  5. Bank of India
  6. Bank of Maharashtra
  7. Canara Bank
  8. Central Bank of India
  9. Corporation Bank
  10. Dena bank
  11. HDFC Bank
  12. ICICI Bank
  13. IDBI Bank Limited
  14. Indian Bank
  15. Indian Overseas Bank
  16. Jammu and Kashmir Bank
  17. Oriental Bank of Commerce
  18. Punjab National Bank
  19. State Bank of Bikaner & Jaipur
  20. State Bank of Hyderabad
  21. State Bank of India
  22. State Bank of Indore
  23. State Bank of Mysore
  24. State Bank of Patiala
  25. State Bank of Travancore
  26. Syndicate Bank
  27. UCO BANK
  28. Union Bank of India
  29. United Bank of India
  30. Vijaya Bank

Service Tax Voluntary Compliance Encouragement Scheme: Issues related to Undertaking, Payment of Tax Dues in Installment

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The Service Tax Voluntary Compliance Encouragement Scheme. Issues for clarification related to additional undertaking, repayment of tax dues in installment and queries raised by department related to VCS declaration statement.

  • VCS Undertaking for Tax Dues related to VCS period only, there is only single undertaking that all the information given in VCS statement/declaration is true and correct. So Designated Authority should not ask for any other undertaking or declaration.
  • Payment of Service Tax in installment i.e. Payment of 50% tax dues in installment is allowed till 31.12.2013 and remaining 50% can be deposited in installment till 30.06.2014 without interest and with interest till 31.12.2014.
  • Designated Authority can only raise queries related to arithmetical check as regards the correctness of computation of tax dues, the Scheme does not envisage investigation by the designated authority into the veracity of declaration. Only if the Commissioner has reason to believe that the declaration filed by the declarant is substantially false he may, for reasons to be recorded in writing, serve notice on the declarant requiring him to show cause why he should not pay the tax dues not paid or short-paid.

 F. No. B1/19/2013-TRU (Pt.)

Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise & Customs
(Tax Research Unit)
***
New Delhi the 11th December, 2013
To,
All Chief Commissioners of Central Excise/Service Tax
Director General Service Tax
All Commissioners of Central Excise/Service Tax
Madam/Sir,
Sub: The Service Tax Voluntary Compliance Encouragement Scheme – issues for clarification – reg The undersigned is directed to state that the Board has issued clarifications on issues concerning various aspects of the VCES, vide circulars dated 13.05.2013, 8.08.2013 and 25.11.2013. A FAQ has also been issued on VCES. However, certain instances have come to notice, as mentioned below, that the declarants under the VCES are still facing difficulties.
2. In one instance, the Designated Authority has asked a declarant, who has “tax dues” only or a part of the period covered by the Scheme, to furnish an undertaking that he had no unpaid “tax dues” for the remaining period covered by the Scheme. However, the Scheme does not envisage furnishing of any such undertaking. A declarant may have tax dues only for a part period covered by the Scheme. In terms of the Scheme a declaration of tax dues has to be made in Form VCES-I, which includes an undertaking that the information given in the
declaration is correct and complete. Therefore, the Designated Authority should not ask for any other undertaking or declaration beyond what has been prescribed in the Scheme or Rules made there under.
3. In another instance, the Designated Authority has objected to the payment of the first tranche of 50%, payable by 31.12.2013, in installments. It is clarified that the Scheme only prescribes that the declarant would pay a minimum amount of 50% of the tax dues by 31.12.2013. Rest of the payment may be made by 30.6.2014, without any interest, and any amount remaining unpaid on 30.6.2014 shall be paid by 31.12.2014, with interest for the period of delay beyond 30.6.2014. There is no bar to pay these amounts in installments. For example a declarant may pay the 50% amount that he is required to pay by 31.12.2013 in more than one installment. Therefore, payment of 50% “tax dues” in lump-sum may not be insisted to.
4. In some instances, it has been observed that the Designated Authority has raised frivolous/unnecessary queries as regards the veracity and the manner of calculation of tax dues. While the designated authority may cause arithmetical check as regards the correctness of computation of tax dues, the Scheme does not envisage investigation by the designated authority into the veracity of declaration. Only if the Commissioner has reason to believe that the declaration filed by the declarant is substantially false he may, for reasons to be recorded in writing, serve notice on the declarant requiring him to show cause why he should not pay the tax dues not paid or short-paid.

Extension of Due Date of Filing Income Tax Return & Audit Report for FY 2012-13: AY 2013-14

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Central Board of Direct Taxes (CBDT) has extended the due date of filing of Income Tax return and Audit report for FY 2012-2013.i.e AY 2013-2014 to 31st Oct 2013 from prescribe due date of 30th September 2013. Such decision has taken by CBDT after Delhi Chartered Accountant Society has filed writ petition in Delhi High Court for  extension of due date of tax audit as on the last date of tax Audit  i.e. 30.09.2013 there was default on the part of the Respondents as the site of the Income Tax Department was not working or response time of income tax website was very slow which made the e-filing of Income tax return impossible.

F.No. 225/117/2013/lTA-II
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
North- New Delhi,

The Order under Section 119 of the Income Tax Act 1961

In exercise of powers conferred under section 119 of the Income-tax act, 1961 The Central Board of Direct Taxes, In continuation to order u/s 119 dated 26.09.2013 in F.No. 225/117/2013/1TA.II, hereby directs that in cases where the ‘due date’ of  furnishing audit and corresponding income-tax returns was 30th September, 2013 and when furnished electronically on or before 31 14 October, 2013, such reports of audit income shall be deemed to have been furnished within the ‘due date’ prescribed under section 139 of the Income-tax Act, 1961.