cs smitesh desai
TRANSCRIPT
098 251 20338 CS Smitesh Desai [email protected]
Bejan Daruwala has an Astro Consulting Chamber in a Mall at Mumbai & also one such Chamber at Delhi Airport. Which of these is liable for Service Tax?
Both are liable for Service Tax
Neither is liable for Service Tax
Airport Chamber is liable for Service Tax
Mall Chamber is liable for Service Tax
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Owned by Builder Owned by Client Owned by Client
Sold to Client No Sale of Land No Sale of Land
Owned by Builder
Sold to Client Sold to Client No Sale of Structure
Stamp Duty Only If Money paid after
Completion VAT Service Tax
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Stamp Duty Plus Service Tax, If Money
paid before Completion
10
Sale includes transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract
"works contract" includes any agreement for carrying out for cash or for deferred payment or for valuable consideration, the building construction, manufacture, processing, fabrication, erection, installation, fitting out, improvement, repair or commissioning of any moveable or immovable property;
098 251 20338 CS Smitesh Desai [email protected]
• Renting of immovable property without granting possession is
• not liable to service tax
• liable to service tax
13
• Renting of movable property without granting possession is ____________
• not liable to service tax
• liable to service tax
14
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Santa Singh sells 10,000 US$ to SBI for Rs.45/= each
098 251 20338 CS Smitesh Desai [email protected]
Santa Singh sells 10,000 US$ to SBI for Rs.45/= each
Banta Singh buys 10,000 US$ from SBI for Rs.46/= each
098 251 20338 CS Smitesh Desai [email protected]
The Reserve Bank of India compiles and publishes on a daily basis reference rates for Spot USD-INR and Spot EUR-INR. Under the existing methodology, the rates are arrived at by averaging the mean of the bid/offer (buy/sell) rates polled from a few select banks around 12 noon every week-day (excluding Saturdays). The contributing banks are selected on the basis of their standing, market-share in the domestic foreign exchange market and representative character. The Reserve Bank periodically reviews the procedure for selecting the banks and the methodology of polling so as to ensure that the reference rate is a true reflection of the market activity.
098 251 20338 CS Smitesh Desai [email protected]
Santa Singh sells 10,000 US$ to SBI @ Rs.45/=
Banta Singh buys 10,000 US$ from SBI @ Rs.47/=
RBI Reference Rate is Rs.46/=
What is the assessable value of the transactions?
Santa Singh to SBI = Rs.10,000/=; Service Tax @ 10% = Rs.1,000/=
SBI to Banta Singh = Rs.10,000/=; Service Tax @ 10% = Rs.1,000/=
Or Alternatively, 1% of the Rupees Exchanged
Santa Singh to SBI = 1% of Rs.4,50,000/= ie Rs.4,500/=; ST = Rs.450/=
SBI to Banta Singh = 1% of Rs.4,70,000/= ie Rs.4,700/=; ST = Rs.470/=
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What about Interest on
Savings Accounts, Fixed
Deposits & Recurring Deposit
Accounts?
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SRK & Gauri Khan go to Paris for a holiday.
There they have a haircut for US$ 1,000/= each, by Guy Larosche
The Customs Officer at Mumbai Airport tells SRK: Service Tax is payable on Import of
Services. The Customs Officer does not bother Gauri Khan
SRK had got his hair parted at the right by Guy Larosche. He then appears in Pepsi ad
SRK is very disturbed. He goes to an evening party, where he talks to Akshay Kumar &
Twinkle
Akshay says: This is rubbish. Guy Larosche did his haircut on the sets of a film last
week – no service tax was paid. We also engaged Javed Habib’s saloon for getting
Twinkle hair cut by Guy Larosche
Clause Description of Service Import/Export
d General Insurance
be such services as
are provided or to be
provided in relation to an
immovable property
situated in India/outside
India
m Mandap Keeper p Architect q Interior Decorator v Real Estate Agent
zzq Commercial or Industrial Construction zzza Site Formation & Clearance, Excavation & Earth Moving & Demolition zzzb Dredging zzzc Survey & Map Making zzzh Construction of (Residential) Complex zzzr Auction of Property zzzy Mining of Mineral, Oil or Gas zzzz Renting of Immovable Property
zzzza Works Contract zzzzm Legal Consultancy zzzzu Preferential Location Service zzzzv Air Conditioned Restaurants with Liquor Licence zzzzw Temporary Accommodation
Clause Description of Service Clause Description of Service a Stock Broker zza Storage or Warehouse Keeper f Courier Agency zzc Business Auxiliary Service h Custom House Agent zzd Erection, Commissioning & Installation i Steamer Agent zzf Internet Café j Clearing & Forwarding Agent zzg Management, Maintenance or Repair l Air Travel Agent zzi Technical Inspection & Certification Agency n Tour Operator zzl Port Services o Rent-a-Cab Scheme Operator zzm Airport Services w Security Agency zzo Business Exhibition z Underwriter zzt Outdoor Caterer
zb Photography Studio or Agency zzv Survey & Exploration of Mineral zc Convention Centre zzw Pandal or Shamiana Contractor zi Video Production Agency zzx Travel Agent zj Sound Recording Studio or Agency zzy Forward Contracts zn Port Services zzzd Cleaning Activity zo Automobile Repair Service zzze Club or Association zq Beauty Parlour zzzf Packaging Activity zr Cargo handling Agency zzzzg Recognised Stock Exhange zt Dry Cleaner zzzzh Recognised Association zu Event Manager zzzzi Processing & Clearing House zv Fashion Designer zzzzk Cosmetic or Plastic Surgery zz Rail Travel Agent zzzzl Coastal Transport of Goods zzzzo Clincal Establishment
098 251 20338 CS Smitesh Desai [email protected]
A Goods Transport Agency carries inputs for my business use from my vendors to my
factory. He gives me a consignment note for Rs.10,000/=. Am I supposed to pay the
service tax on this amount?
I understand that there are some concessions such that I end up paying 2.58% service
tax on this amount. Is that right?
Which means that I deduct Rs.258/= from his service charges & pay him Rs.(10,000 –
258) = Rs.9,742/=
Am I entitled to cenvat credit of Rs.258/=
Do I have to register under service tax law as Goods Transport Agency, although I am
really only a recipient of such service?
Does that mean I must pay Rs.258/= from my pocket?
Does the same mechanism apply for all Reverse Charge Mechanism Sectors, except
the concessions?
098 251 20338 CS Smitesh Desai [email protected]
HDFC bank has opened 5000 branches. All these branches have ATMs. In addition to
this the bank has also outsourced ATM operations to a service provider for establishing
ATMs at Airports, Railway Stations, Malls, etc, at 7000 locations.
HDFC must obtain service tax registration for 12000 units
HDFC may obtain standalone service tax registration for 5000 units
The ATM service provider must obtain service tax registration for 7000 units
HDFC may seek one centralised registration for all 5000 branches
Alternatively HDFC may seek multiple regional registration covering say, 1000 regional
branches
If HDFC seeks centralised registration, then all subordinate branches must be
mentioned in the application for registration
If HDFC seeks centralised registration, then new branches must be added in the
registration certificate every time a new branch is opened
HDFC can seeks centralised registration for credit card business & standalone
registration for other businesses
098 251 20338 CS Smitesh Desai [email protected]
How many Services can Service Tax Registration Certificate accommodate?
So, it makes good admin sense to register for all the 120 services at once
ST-3 return may be filed either manually or electronically
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Service Tax must be generally paid by
5th of next month
10th of next month
End of current month
Service Tax must be paid by net savvy assessees by
5th of next month
6th of next month
10th of next month
15th of next month
Service Tax for March must be paid by all assessees by
31st March
1st March
1st April
Assessees paying >
10 lacs annually
must pay the tax by
net banking
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promotion or marketing or sale of goods produced or provided by or belonging to the client; or
promotion or marketing of service provided by the client; or
any customer care service provided on behalf of the client; or
procurement of goods or services, which are inputs for the client; or
production or processing of goods for, or on behalf of, the client;
provision of service on behalf of the client; or
a service incidental or auxiliary to any activity specified in sub-clauses (i) to (vi), such as billing,
issue or collection or recovery of cheques, payments, maintenance of accounts and remittance,
inventory management, evaluation or development of prospective customer or vendor, public
relation services, management or supervision
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“support services of business or commerce” means services provided in relation to
business or commerce and includes evaluation of prospective customers, telemarketing,
processing of purchase orders and fulfilment services, information and tracking of
delivery schedules, managing distribution and logistics, customer relationship
management services, accounting and processing of transactions, Operational or
administrative assistance in any manner, formulation of customer service and pricing
policies, infrastructural support services and other transaction processing.
Explanation
For the purposes of this clause, the expression “infrastructural support services”
includes providing office along with office utilities, lounge, reception with competent
personnel to handle messages, secretarial services, internet and telecom facilities,
pantry and security
• Health services, namely: (i) health check up undertaken by hospitals or medical
establishments for the employees of business entities (corporate health check-up schemes) and
(ii) health services provided under health insurance schemes offered by insurance companies (cash-less medical insurance) [Section 65 (105) (zzzzo)].
43 098 251 20338 CS Smitesh Desai [email protected]
• Services provided for maintenance of medical records of employees of a business entity [Section 65 (105) (zzzzp)].
• World over, business organizations maintain medical histories of their employees which are used not only for medical purposes but also for finding the suitability of a person for a particular job or for promotion etc. Increasingly, this activity is being outsourced for a consideration. Such records are either maintained by certain designated hospitals or even by independent record keepers for a charge. This activity is now being brought under service tax.
44 098 251 20338 CS Smitesh Desai [email protected]