Penalties and Interest under the Service Tax Provisions

Service tax refers to tax collected by the government of India from certain service providers for providing certain services. The person who pays service tax can be either a service provider or a service receiver or any other person who is responsible for providing certain services


Service tax is an indirect tax levied on the services provided by a service provider in India. The said tax shall be paid on all service provided except those mentioned in Negative List.


Service tax is paid by the end consumer of the service and the service provider is responsible for collection of remittance from the recipient of the taxable service. Penalties and Interest under the Service Tax Provisions:



Service tax registration is mandatory for every person or business that has provided a taxable service of value exceeding Rs.9 lakhs in the previous financial year.


Every service provider who is liable to pay service tax shall apply for registration by using the application Form ST – 1 within 30 days from the date on which service tax is charged.



Company/  AOP/ HUF- Monthly

Individual / Proprietary firm or Partnership firm- Quarterly


Payment shall be done by 6th of the following month/ quarter. For the month of March, payment shall be done by 31st March itself.


Interest Rate for Delayed Payment

Upto 6 months- 18%

More than six month and up to 1 year- 18% p.a. for the 1st six  month of delay and  24% p.a. for the delay beyond 6 months.

More than 12 months- 18% p.a. for the 1st six  month of delay +  24% p.a. for the delay beyond 6 months upto 1 year + 30% p.a. for  any delay beyond one year.



Service tax is only liable to be paid in case the total value of the service provided during the financial year is more than Rs. 10 lakh. If the value of services provided during a financial year is less than Rs. 10 lakh, it is optional for the assessee to avail this exemption or not.



Every person liable to pay service tax shall himself assess the tax due on the services provided by him. Along with this, assessee needs to furnish service tax return to the Superintendent of the Central Excise in the prescribed form.


The person who is liable to pay service tax has to submit half yearly return for the period 1st April to 30th September and 1st October to 31st March of the Financial Year in Form ST-3 within 25 days of the end of half year.


Due date for half year ST return for FY 15-16 is 25th April, 2016. The due date is fast approaching so you should file the return well in time to avoid late fees and penalty.


Assessee providing more than one taxable services: Only one return needs to be filed. However, data of each taxable service shall be shown separately.


If no turnover during the period: NIL return shall be filed as long as registration certificate is valid.



Revised Service Tax (ST-3) return can be filed within a period of 90 days from the date of filing the original return.


Late fee:

First 15 days- Rs.500

15-30 days- Rs. 1000

More than 30days- Rs. 1000 + Rs. 100/ day beyond 30 days


The maximum late fee payable is Rs. 20000.


For proper guidance in service tax contact



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