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The below write-up provides a high-level overview of the important amendments to Service Tax. Some of these changes are effective from 1st of April while other are effective from 1st June 2016

1.       Service Tax on services provided by Government or Local Authority to a business entity under reverse charge mechanism

 a.       Effective from 01.04.2016

b.      The liability to pay service tax will be on the service recipient

c.       Any activity undertaken by the Government against a consideration constitute a service and amount charged for performing such activities are liable to Service Tax. However where the gross amount charged for such service does not exceed Rs. 5000/- , service tax is exempted

d.      Not applicable to a business entity whose turnover is less than Rs. 10 lakhs in the preceding financial year

e.      Taxes, cess, duties are not consideration for any particular service, hence no Service Tax is applicable no such payments

f.        Fines and penalty charged for violation of a statue, bye-law etc is exempted

g.       Service provided for any registration under the law is exempted

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Please email info@jaksllp.com if you require any additional information regarding this Alert. 

JAKS & Associates