Service Tax Rate increased to 15% w.e.f 1.6.2016

(Krishi Kalyan Cess Added @ 0.5%)

View More

  

Normal Charge on Senior Advocate removed,now Senior and Other Advocates treated in same manner w.e.f 6.6.2016

View More

 

 Change in Abatement Rates w.e.f 1.6.2016

AC Stage Carriage Bus is now taxable(removed from Negative List) and there is 60% Abatement (40% Taxable)

Transport of Passengers Old Rate New Rate
Motor Cab 40% 40%
Radio Taxi 40% 40%
Stage Carriage (AC Bus) Exempt 40%
Stage Carriage (Non AC Bus) Exempt Exempt

However,Non AC Stage Carriage (Non AC Bus) continue to be exempt (Notification 9/2016)

 

 Change in Abatement Rates w.e.f 1.4.2016

Name of Service  TAXABLE RATES
  Old Rate New Rate
Goods Transport Agency (Road)    
Normal Cases 30% 30%
For Supply of Old Household Items 30% 40%
     
Goods Transport by Raiways    
by Private Railways 30% 40%
by Government Railways 30% 30%
     
Chit Fund 0% 30%
     
Construction Services    
For Residential unit less than 2000 sq feet + Price Charged > 1 cr 25% 30%
Other Cases 30% 30%
     
Tour Operator Service    
Booking Accomodation 10% 10%
Package Tour Service 25% 30%
Other Cases 40% 30%
     

(Note:- These are taxable Rates,i.e.Rates after claiming abatement)

 

Change in Conditions for Abatement w.e.f 1.4.2016

Now Cenvat of Input Services can be taken in case of following Services also

  • Transportation of Goods by Rail
  • Transportation of Passengers by Rail
  •  Transportation of Goods in a Vessel.

 

 Quarterly Payment of Service Tax

Earlier Quarterly Payement of Service tax waas available only for Individual and Partnership

Now it is available to

  • Individual
  • Partnership
  • HUF
  • One Person Company (OPC) whose taxable turnover from all premises is upto 50 lacs 

(Note:- 50 lac limit is only for OPC,Not for Individual,Partnerhip,HUF) 

Learn More

 

Payment  of Service Tax on Receipt Basis

Normally,Service tax is payable on Bill or Payement which ever is earlier

However,in case of Individual,Partnerhip,HUF,One Person Company (OPC)

IF taxable turnover from all premises is upto 50 lcs in previous year,

then Service tax payable on receipt basis upto 50 lacs in Current Year

 (50 lacs limit is for all 2 in this case, HUF not eligible for Payement of Service tax on Receipt Basis)

 

Special Rates for Single Annuity Life Insurance Plans

New Amendment

 For Single Premium Anuity Insurance Policies,

Insurance Premium is to be paid only in first year and not after that

 

In this case,

Rate prescribed are 1.4% of Total Premum Charged++Swachh Bharat Cess+Krishi Kalyan Cess

i.e. 1.5%

 

Year

% of base fare

(OLD RATE)

Effective Rate of

Service tax

Effective Rate of

Swachh Bharat Cess

Effective Rate of

Krishi

Kalyan

Cess

Total

Rate of

Service

Tax

First Year

(Single Premium)

N/A

1.4%

0.10%

0.10%

1.5%

Next Year

N/A

N/A

N/A

N/A

N/A

 

This is applicable only where the amount allocated for investment or savings on

behalf of policy holder is not intimated to the policy holder at the time of providing of service

 

New Annual Return For Service Providers

This return to be filed in addition to Normal Return whose due date will be 30 November

(Learn More)

 

Interest on Late Payment of Service Tax

New Interest Rates Applicable from 14.5.2016

Case

Rate of Interest

Service Tax collected from customer but not deposited to Government

24%*

Other Cases

(Amount not yet paid by Customer)

 

15%*

 

* There is 3% concession if

value of taxable service provided in previous financial year does not exceed Rs 60 lakh

  (Learn More)

 

  1. Tax Practical
  2. Practical Service Tax

About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 8 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .