Key amendments under Chapter V of Finance Act, 1994:
Retrospective amendments:
♦ No reversal of credits in respect of services provided to Special Economic Zones The time limit for raising invoice as per Point of Taxation Rules, 2011 is increased from 14 days to 30 days.
Upper limit of Rs. 2,00,000 for self adjustment of excess Service Tax paid has been eliminated.
Credit of repair, hiring and insurance of motor vehicles will be allowed to specified service providers and manufacturers.
♦ Credit of goods can be taken even if they are not brought to the premises of service provider subject to documentation.
♦ Credit can be taken based on tax paid challan,in case tax is paid as service recipient.
♦ Input service distributor can distribute credit only on pro rata basis to other units proportionate to the respective turnovers.
♦ The procedure for claiming refund of inputs / inputs services is simplified under Rule 5 of Cenvat Credit Rules, 2004.
♦ Input service distributor can distribute credit only on pro rata basis to other units proportionate to the respective turnovers.
♦ The procedure for claiming refund of inputs / inputs services is simplified under Rule 5 of Cenvat Credit Rules, 2004.
Criteria for claiming basic exemption changed:
Hitherto, the threshold exemption from levy of Service Tax was available if the first consecutive payments received in a year did not exceed Rs. 10 lacs, excluding the payments received towards exempt service. Now, instead of considering the receipts as the base of exemption, what is to be
considered are the aggregate value of invoices issued in a year. Introduction of Negative list and Exemption list:
considered are the aggregate value of invoices issued in a year. Introduction of Negative list and Exemption list:
The erstwhile mechanism of taxing a particular activity based on the taxable categories is being removed and is replaced with “Negative Negative list covers 17 services on which Service Tax is not applicable.
