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Calculation of service tax, Service Tax |
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Calculation of service tax |
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Is calculation of service Tax on accrual basis or payment basis. Are both the methods allowable. Is it possible to shift from one basis to another after adopting eother Posts / Replies Showing Replies 1 to 3 of 3 Records Page: 1
Service tax liabilty arises on payment basis. There is no bar on making payment in advance.It is advisable to make payment of service tax on receipt basis.
Service tax is payable on the basis of 'receipt' i.e at the time of receipt of service charges. However, if the transaction is between 'Associated enterprises' (as covered u/s 92A of IT Act), service tax liability is to be discharged at the time of accrual/receipt whichever is earlier.
View expressed by V Ramanujam is correct.
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