How to Pay Service Tax

Name should not be empty

Service Tax is an indirect tax that is payable by the service provider to the government. This is charged on the services provided by the provider to the service recipients.

Every service provider is required to apply for service tax registration if the value of services provided by him during a Financial Year exceeds Rs. 9 lakhs but the tax should be paid only if the value of the services exceeds Rs. 10 lack per annum.


Process Flow for the payment

  • FormG.A.R.7 (previously known as TR6 Challan) should be used to make service tax payments. Service Tax can also be paid electronically, using e-payment facility.
  • Mode of Payment: To be made at the specified branches of the designated banks and by cheque. The details of such Banks and branches may be obtained from the nearest Central Excise Office/Service Tax Office. 
  • Procedure to be followed in the absence of full details:
    Under these circumstances, provisional assessment is resorted to. If an assessee is unable to correctly calulate the actual amount of Service Tax payable for any particular month or quarter, as the case may be, he can make a request in writing to the Asstt. / Dy.Commissioner of Central Excise as provided under sub –rule (4) of Rule 6 of the Service Tax Rules, 1994, giving reasons for seeking payment of Service Tax on provisional assessment basis. On receipt of such request for provisional assessment, the Asstt. / Dy.Commissioner of Central Excise may allow for the payment of Service Tax on provisional basis on such value of taxable service as may be specified by him in a speaking order issued to that effect. Provisional assessment is finalized after furnishing the returns in Form ST-3A along with Form ST-3.
  • Service Tax to be paid on: This is to be paid on the invoice amount or the billed amount. Service Tax is to be paid on the gross value of taxable service which is charged by a Service Tax assessee for providing a taxable service. Income tax deducted at source is includible in the charged amount. Therefore, service Tax is payable on the gross amount including the amount of Income Tax deducted at source also. 
  • Penalty on non-payment of service tax: If a person who is liable to pay Service Tax fails to ay service tax, he shall pay in addition to such tax and interest, a penalty which shall not be less than Rs.100/- for every day during which such failure continues or @1% of such tax per month, whichever is higher. However, the penalty amount payable shall not exceed the amount of Service Tax payable.

What's your reaction?
Helpful - 10
Not helpful - 3
Need more detail - 0
Name should not be empty