Service tax collected from a client or customer has to be paid to government of India before the due dates as stipulated in the act. In case of delay in payment, interest and other penal provisions will be applicable on the person who is responsible for such payments.
Due dates for payment of service tax is mentioned in rule 6 of the service tax rule 1994. Such due date is different from person to person.
Service tax payment due dates for an individual or partnership firm is 5th day of the following quarter in which assessee has received payments.
In cases where the individual or partnership firm has chosen online mode for payment of service tax then additional one day is allowed as a grace period for payment of service tax i.e. in case of online payment the due date is 6th day of the following quarter.
Other than individuals and partnership firms, service tax payment due date is monthly instead of quarterly. For companies and others except individuals and partnership firms, service tax payment due dates is 5th day of the following month in which service tax is collected.
One day as grace period is available if payment is made online i.e. due date of payment of service tax in cases where online payments are made will be 6th day of the following month instead of 5th day.
However, to all these, there is an exception. Service tax collected for the month or quarter ending 31st march has to be paid on or before 31st march of the financial year.
Tabular form to understand service tax payment due dates
|Assessee||If Service tax payments are not online (offline payment)||If service tax payments are online||Service tax collected for the month of march|
|Individual or partnership firm||5th day of the following quarter||6th day of the following quarter||31st march|
|Others||5th day of the following month||6th day of the following month||31st march|
Where payments are made in cheque, the date of payment of service tax shall be the date as mentioned on the cheque subject to clearing of the cheque.
In cases where assessee has not paid service tax before due date as mentioned above, interest will be levied on such non payment of service tax. Interest rates as applicable are stated below;
Applicable to cases before 1st October 2014
|Gross Turnover||Interest rate p.a.|
|For more than 60 lakhs rupees||18%|
|Less than 60 lakhs rupees||15%|
With effect from 1st of October 2014
|Delay in Months||Simple interest rate per year|
|For delay up to 6 months||18%|
|For delay from 6 months to 1 year||24%|
|For delay in more than 1 year||30%|
As discussed above service tax has to be paid on or before the due date of payment. If, in case, such payment is over and above the actual due amount then the excess amount can be adjusted in next month payment. Where such adjustment is not possible, assessee can claim refund.
Where service is not taxable but assessee has charged and collected service tax from customer or client then such amount collected as service tax has to be paid to central government before the due dates as discussed above.