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What is Service Tax Registration and who should pay it in India

As on 1st May, 2011, 119 services are taxable services in India. These taxable services are specified in Section 65(105) of the Finance Act,1994. And there are 17 specific services which are exempt from service tax mentioned in the Negative List .Service tax is applicable  to the whole of India, except the State of Jammu & Kashmir.sevice-tax-registration-india

What is Service Tax

Service Tax is a tax imposed by Government of India on services provided in India. The service provider collects the tax and pays the same to the government. It is charged on all services except the services in the negative list of services. The current rate is 12.36% on gross value of the service.

Who should Pay Service Tax

If you or your business provides Service, Which means providing intangible benefits to others, that can be doing some work on behalf of others or professional advice etc. You are liable to register yourself for Service tax registration when in a year your firms total turnover crosses 9 lacs. And when your turnover crosses 10 lacs,  it becomes compulsory for you to start collecting the service tax from your customer whenever you render the service. (One example – When we buy things from a small shop he wont charge service tax as their turnover is less, but when you buy from big shop they will charge you service tax. ) You have to collect the tax (at the rate 12.36% currently)  from your customer and pay it to the government.

Any person who has collected any sum on account of service tax, is under obligation to pay the same to the Government. He can not retain the sum so collected with him by contending that service tax is not payable.

When to pay Service tax

Service tax is paid quarterly or monthly based on your business registration. Any person providing taxable service to any person shall pay service tax at the rate specified in Sec.66 (currently 12.36%)

If you are Individual, Sole Proprietorship or Partnership or LLPs, you have to pay the tax Quarterly(4 times in year) quarters are: April to June, July to September, October to December and January to March.  The due date for payment of service tax is the 5th of the month immediately following the respective quarter ( in case of e-payment, by 6th of the month immediately following the respective quarter). But Service Tax for quarter ending 31st March is Payable by 31st March itself.

If you belong to any other category of business registration like Pvt ltd then you have to pay service tax on a monthly basis, i.e,  by the 5th of the following month.

How to Pay Service tax Online

For e-payment, assessees should open a net banking account with one of the authorized banks (currently there are 28 banks), in which the assessees will have to log into their bank account and pay the tax directly from their account.  ‘or’ assessees can access the ACES website ( and click on the e-payment link that will take them to the EASIEST (Electronic Accounting System in Excise and Service Tax) portal ( or they can directly visit the EASIEST portal.

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