Service Tax is a kind of tax imposed by the Central Government of India on the services provided or promised to be rendered as per the Place of Provision of Services Rules, 2012. The tax is collected from the person who is liable to pay the amount whether the individual is a service provider, service receiver or anyone else, as per Point of Taxation Rules, 2011. The Service Tax is not levied on the services listed under the negative list. The service tax levied is at 14% as of June 2015.
Service Tax Registration
Service Tax registration is the registration required to be done by every business involved in service provisions in India. It is an indirect tax where the tax paid by the service provider is recovered from the amount collected from the end recipient of the services, usually the end consumers.
It is mandatory for every business in India to have Service Tax registration, subjected that their total value earned is more than Rupees 9 Lakhs in the year prior to the current financial year. Service Tax registration is essential to identify the service tax deposited by the assessee and service tax returns filed under the Financial Act of 1994. Under Section 77 of Financial Act, 1994, a heavy penalty is applied on the individuals who fail to obtain Service Tax Registration.
Service Tax Registration Online
Service Tax Registration can be done online without any hassle by any assessee. To make the services better for the taxpayers, the Central Board of Excise and Customs has introduced a new software in the market called ACES which stands for Automation of Central Excise and Service Tax. ACES facilitate the entire process of taxation including registration, returns, refunds, accounts and many other services. By registering with ACES an individual taxpayer can easily apply for Service Tax registration online.
How can one apply for Service Tax Registration Online?
To apply for Service Tax Registration the taxpayer must file ST-1 online. However, if you are a first-time user then a new account has to be created.
To create an account, follow the steps given below:
- Visit the official ACES (Automation of Excise and Service Tax) website.
- Click on the option ‘Service Tax’.
- On the next page, you will get various options, one of which will be ‘New User’ option. Click on it then you will get directed to the relevant registration page.
- You will need to fill the details required like the name of the unit, designation, phone number etc. to register on the website.
- Click on ‘Submit’ at the bottom of the form once you have filled all the details.
- An account will be created for you and you will receive the username and password of the account through email within 24 hours of filling the details on the site.
Listed below are the steps on how to apply for Service Tax Registration
- Once you have received your username and password, you need to change your password after logging in the first time.
- The account created will be a permanent account dealing with all the matters related to Service Tax.
- After logging in you need to click on the REG tab shown on the screen.
- Under REG tab there will be two options provided- Fill ST-1 and Change Password.
Select ‘Fill St-1’option and enter all the details requested in the form like:
- Details of Permanent Account Number
- Constitution of applicant
- Contact details of the proprietor
- Category of registrant
- If you are providing more than one service or offering one service from more than one location then you need to register all the services/locations in the same form which can be done by clicking on the Service Offered Option and selecting the Services.
- You need to provide the details of the Commissioner, Division, and Range with whom you are registering yourself.
- The information on the above-given subject is provided on the official government website.
- After submitting all the details, you will receive an acknowledgment slip.
- While registering online you need to print this acknowledgment slip, sign it and submit it as a hard copy to Commissioner with whom you are registering.
- The Commissionerate address can be also acquired from the official website.
- Upon successful completion of the procedure, you will receive your Service Tax Number.
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Documents Required to Apply for Service Tax Registration
The documents required to obtain service tax registration number are:
- A self-attested copy of the PAN card under your Company or a Legal entity.
- A photograph and your identity proof which can be any of the following: PAN Card, Passport, Voter ID Card, Aadhar Card, Driving License, any Photo-ID Card issued by Central or State Government or Public-Sector Undertaking.
- Address proof for the address mentioned by you in the form. Along with Proof of Ownership, Lease or rent agreement, Allotment letter from the Government, No objection certificate from the legal owner.
- Bank Account Details
Documents Required for Service Tax Registration for a Company
- Memorandum of Association.
- The article of Association.
- List of Directors.
- Authorization of the person filling the form is required by the Board of Directors, Partners, and Proprietors.
- Business Transaction Number that is provided by Government department and agencies before the filing of Service Tax (such as Custom Registration Number, Import Export Code number, Value Added Tax (VAT), Central Sales number and Company Index Number are also to be submitted).
Service Tax Registration Status
After the ST-1 form has been submitted, the Superintendent has two days to either grant the Service Tax Registration (ST-2) or reject the application and follow-up the non-acceptance notification to the candidate. If neither of the two actions are performed within 2 days the application is automatically considered as accepted. When accepted you will be issued a Service Tax Number which is required to quote all invoices.
The applicant can track the progress and status of the Service Tax Registration form online, by login into their personal ACES account.
Understanding the Structure of Service Tax Number
A 15-digit Service Tax Number based on your PAN is issued. It follows the given pattern:
- First 10 digits are same as PAN (Permanent Account Number) digits.
- Digit 11 and 12 are the Service Tax Codes referred as SD or ST.
- Digit 13 to15 determine registration number starting from 001.
Assesse Verification Steps for Service Tax Registration
- Go to the official website of Central Board of Excise and Customs.
- Enter the 15-digit Service Tax Number and perform the step of image verification.
- Details of both service tax assessees and central excise assessees can be detected by this method.
The information that you will receive are given below:
- Address of Assessee.
- Name of Assessee.
- Name of Assessee.
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Key Points about Service Tax Registration
- In a Service Tax Registration Form, it is essential for the applicant to provide his/her PAN number.
- Every applicant needs to provide his/her email address and phone number.
- It is not necessary for the applicant to rent a commercial property. One can file for Service Tax Registration by furnishing his or her home address as an office address.
- Service Tax Registration is usually approved in the name of the body running the business. For example, any company, partnership or proprietorship. A person should apply for Service Tax Registration in his/her name if he/she does not have a registered entity. Service Tax Registration will be granted on his/her name.
- Every Service Tax Registration holder, after the registration has been granted, is required to file Service Tax Returns on a half yearly basis, irrespective of whether the Service Tax has been paid or not.
- A person can claim Service Tax Exemption if the total value earned in the previous year is less than Rupees 9 Lakhs and is thus, not required to apply for Service Tax Registration.
- If a service provider already holds Service Tax Registration, Service Tax Exemption can still be claimed if the amount earned is less than Rupees 9 Lakhs. Though he/she is liable to pay half yearly returns.
- In case the documents required for Service Tax Registration are not submitted within 15 days (or) if the documents are incomplete or incorrect, then Service Tax Registration will be revoked.
- If no Service Tax is payable when the services are exported, there is no need to file for registration.
- One single registration needs to be filed even when a single entity provides more than one services.
- Registration does not mean that Service Tax should be paid. Registration is required to determine the location of Service provider and receiver.
- Even without registration Cenvat Credit is available to the entities.