As per the Service Tax Rules framed by the Govt. of India, Payment of Service Tax should be made at regular intervals. The Service Tax collected by the Service Provider shall be paid to the credit of the Central Govt. on a regular basis before the Due date for Payment of Service Tax and in case of Late Payment of Service Tax – Interest shall also be payable on the Late Payment as prescribed.
In case you are still not sure regarding the Rates of Service Tax, you can check the Current Rates in force by referring here – Service Tax Rates or in case you still havent registered yourself for Service Tax, refer our article on Procedure for Service Tax Registration Online
Due Date for Payment of Service Tax
As per Rule 6 of the Service Tax Rules 1994, the due date for payment of service tax is separate for Individual/ Partnership Firms and others.
For Individual/Partnership Firms
The Due Date for Payment of Service Tax in case of Individual/Partnership Firm is 5th of the Following Quarter in which the Payment is received. However, in case the Service Tax Provider opts for online payments, he is given a grace period of 1 day and thus the Due Date for Payment of Service Tax if the Payment is made online is 6th of the following Quarter.
For all Service Tax Payers (except Individual and Partnership Firms), the Due Date for payment of Service Tax is 5th of the Following Month in which the Service Tax is collected. However, if the payment is made online – the due date for payment of service tax becomes 6th of the following month
Exception: – Service Tax Collected for the month/quarter ending March shall be payable by 31st March of the said calendar year
The Payment Schedule has been summarised below for your ready reference
|Individual/Partnership||Quarterly||5th of the Following Quarter||6th of the Following Quarter|
|Others||Monthly||5th of the Following Month||6th of the Following Month|
From the above it is clear that it is beneficial to pay the amount due online as a grace period of 1 day is allotted and moreover the Tax Payer does not have to stand in long queues for depositing the Service Tax. Payment of Service Tax Online is a simple 3 Step Process and you for payment of service tax online – you can refer this article on Payment of Service Tax Online.
Late Payment of Service Tax
Interest rate for late payment of any Indirect Tax has been rationalised by the Govt in Budget 2016-17. The interest rate for late payment of any Indirect Tax i.e. Service Tax, Excise, Customs etc would now the same.
The interest rate for late payment is as follows:-
|Service Tax not collected and not deposited||15%|
|Service Tax collected but not deposited||24%|
In case of assessee, whose value of taxable services in the preceeding financial year is less than Rs. 60 Lakhs, the rate of interest for late payment of service tax in such cases would be 12%.
Other Relevant Points
- If there is excess payment is made by mistake or due to any other reason, the amount paid in excess may be adjusted against the Service Tax Liability for the coming period or may claim Refund of Service Tax in case Self-Adjustment is not possible
- If any person liable to pay Service Tax has collected an amount in excess of the amount due from the service recipient, the whole of such amount collected in excess shall be payable to the Central Govt.
- If the Payment is deposited by way of a cheque, the date of payment of Service Tax shall be the date of the cheque rather than the date of clearing of cheque (subject to clearing of the cheque)