BUILDER’S SERVICE TAX under new regime of taxation. All the services specified in the “Negative List” shall remain outside the scope of service tax net. All other services, except those specifically exempted by the Govt. by way of notification, would be chargeable to service tax.
Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.
new regime of taxation
All other services, except those specifically exempted by the Govt. by way of notification, would be chargeable to service tax.INTRODUCTION OF NEGATIVE LIST APPROACH TO TAXATION OF SERVICES
A detailed guidance note on its operationalisation has been placed on the website of service tax.
The name of the booklet is “Service Tax Educational Guide” and contains 150 pages.INTRODUCTION OF NEGATIVE LIST APPROACH TO TAXATION OF SERVICES
The old sections are made non applicable from 01.07.2012, as the new sections have been made operational.INTRODUCTION OF NEGATIVE LIST APPROACH TO TAXATION OF SERVICES
The government has now shifted from positive list to negative list approach.
Let us see what is the total of all services under the proposed new “Regime”
Section 66B is the new charging section for service tax.
Section 66C deals with the determination of place of provision of service.
Section 66D contains the negative list of services.
Section 66E lists the declared services.
Section 66F list the principles of interpretation of specified descriptions of services or bundled services.NEW SECTIONS
All service tax hence forth will be paid on a single accounting code.Other important points
An activity of transfer of title in goods or immovable property, by way of sale, gift or in any other manner;
Transaction in money or actionable claims;
Service provided by an employee to his employer in the course of employment;
Fees Taken in any Court or tribunal.Definition of “service”
The previous definition consists of 12 residential units is no more available to builders w.e.f 01.07.2012.
Competent Authority for issue of completion certificate if now the local authority only.
However, personal house constructed by Individuals with the help of contractor will still be out of the purview of service tax.New definition of complex
Service Tax( Removal of Difficulty) Order, 2010:certain professionals like Architect, Chartered Engineer and Licensed Surveyor were also made competent authority continueService tax –completed complex or not (levy of tax)
This clause needs to be reconsidered in light of practical difficulties.Continued
continueWc-dispute minimised wef 1-7-12
There shall be levied a tax at the rate of twelve percent on the value of all services other than those services specified in the negative list provided or agreed to be provided in the taxable territory by one person to another and collected in such a manner as may be prescribed.
It was later clarified that Education Cess will continue.The new charging section
Lists the following services, the service tax on which will be paid by the service receiver:
Works Contract Services (New)
Any service imported from outside India.
Services of directors other than under employer employee relationship like sitting fees, commission, remuneration etc.OTHER IMPORTANT NOTIFICATIONS
calculate the value of transfer of property in goods involved in the execution of works contract (either taking the value as considered for VAT purpose or ascertaining on actual basis) and deduct the same from Gross amount charged for works contract
If above is not acertained, then value as per following tableValue of services
w.e.f 01.07.2012, the CENVAT credit rules have been amended and service providers covered under works contract and builders services would be allowed to avail CENVAT credit on input services and capital goods.
(Notification no. 26/2012-ST dt. 20.06.12)CENVAT TO WC AND BUILDERS WEF 1-7-2012
Relevant abatement scheme as given in Sr. 12 of table given in Notification No. 26/2012 dated 20.06.2012 is as under:25% Scheme with cenvat.WEF 1-7-2012. benefit to builders to reduce cost
However, now, CENVAT Credit in respect of capital goods and input services (as defined under rule 2 of CENVAT Credit Rules, 2004) has been allowed w. e. f. 01.07.2012. (CENVAT credit in respect of inputs shall not be allowed). ContinueBenefit in the form of CENVAT Credit:
Usually, developers get the construction done from a construction contractor who charges service tax from developers in respect of construction services provided to developers. ContinueCONTINUED
Now, developer shall continue to charge service tax from their customers, however, they will now avail CENVAT Credit and deposit lesser amountCONTINUED
Immediate credit on receipt of invoice,
Payment of invoice to be made within a period of three months from the date of issue.
Reversal of credit if payment is not made within the stipulated period.
Credit can be taken again for such cases on the basis of actual payment.
In cases of service tax paid on reverse charge basis, credit can be taken on the date of payment.Other important points
Y O U