Now, India knows as service provider from cooking services to advance technical services, Indian persons are counted as best service provider. There are two effects this. One is positive because this is good for the growth of our economy. But the responsibility of Accountants of service providers is increased on the other side. They now are responsible for filling the return of service tax for paying the payable amount of service tax. So, as professional accounting blogger, it is my duty to aware young accountants for giving guidance by my deep study on the accounting treatment of service tax. From some of my queries, I found that today accountant has no sufficient and prefect knowledge of the accounting treatment of service tax in the books. Before starting accounting treatment, I give you some basic detail of service tax
Service Tax is indirect taxes. If service provider provides any taxable service, it is his duty to pay service tax. Generally tutors, doctors, engineers and lawyers are liable for service tax to be paid on them. Service tax in India is administered by the Central Board of Excise and Customs and the Federal and State governments in case of the USA
Government of India has right to collect service tax from service provider of different services provided under chapter V of finance Act 1994 and different rules under Service Tax Rules, 1994 Government of makes different forms for filing service tax return . Time to time Govt. of India provides of different notification for any changes in service tax rules .
“ Now Govt . has changed the limit of exemption for small service providers upto RS. 8 Lakh " under Budget Announcement 2007-08
Explanation of Accounting treatment of service tax in tally 9
It means when any transaction relating to receiving of any service fees at this time we record also this fee’s service tax liability .
For activate service tax , click on statutory and taxation for activate the service tax by writing yes
Gateway of tally > Feature > statutory and taxation > service tax = yes and service tax alter = yes
fill the form of Company service tax detail . Tell to tally 9 what is the nature of your business and what type of service actually are you giving
Type of organistion = Choose any one out of 9
Major type of service = Choose any one out of 97 service ( Which are you giving )
For knowing the accounting codes first click to display and then go to statutory info and then see the detail of service tax category.
After this accept this statutory and taxation setting and then accept feature F11 for activate service tax option in tally 9
Create the ledger of your different customer by clicking
Account inf > ledger > create
One more thing is noted
Is service tax applicable option must write yes and accept all the ledger of custmors
Also create the ledger of service tax under Duties and taxes and type of duty is service tax and category name is commercial training and coaching center and accept the ledger creation of service tax .
Now pass the voucher entry when you receive the amount of your service fee
Voucher entry > receipt voucher
Account may be cash or bank
Write the name of your customer and net amount received
In advance or on account
Write service tax on the place of not applicable and write the amount of service tax ( More detail of rate of tax also get from tally 9 in the place = display > statutory info > service category )
After this accept this voucher
Pass the voucher entry of the payment of service tax to Government
Voucher entries > payment
Account > bank
Service tax account and amount paid
Write cheque no and date of issue and accept for recording .
Now you have learnt my deep study of accounting treatment of service tax in tally 9 . Now it is your responsibility use it practically because without practical work , there is no benefit of my hard work of writing and your reading . This article is published after getting large numbers of query to my email address firstname.lastname@example.org So I have today published it for benefit of all