The charging section 66B provides that service tax is chargeable on the value of taxable service

In case value of taxable service is zero, service tax on it is also zero

Hence no service tax is payable on free services



Service Tax (Determination of Value) Rules, 2006 are not applicable in this case

as these apply when consideration is not ascertainable

and not when there is no consideration at all


Exam Questions

Question 10
Mr. Vasudevan has conducted a market survey for Mr. Subramanian. However, Mr.
Vasudevan has not charged any fee for such services as Mr. Subramanian happens to be his
best friend. Is service tax payable on such free service? Explain.

View Answer


  1. Service Tax
  2. Service Tax Procedures

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 11 years. He also provides Accounts Tax GST Training in Delhi and Pune.