New, Enhanced for better control
Complete support for Tax on Services
Today, many businesses fall under the Service Tax umbrella. The enhanced Service Tax module of Tally.ERP 9 delivers complete support for tax on services.
Offering a complete solution to manage day-to-day operations, the revised Service Tax module allows effortless tax compliance.
Enhanced Service Tax capabilities of Tally.ERP 9 include:
As per law, tax on advance receipt of service charges is to be paid if the invoice is not raised within 14 days from the date of receipt of advance.
Tally.ERP 9 provides you with the facility to record the advances, calculate Service Tax on advances received/made and to adjust advances while generating sales/purchase invoices.
Let us consider an example: You are a consultant and have received advance payment from a client for a project that may require 8 months to complete.
In this case, you now have to generate a receipt for advance payment received and pay Service Tax on this. When you complete the project, the Service Invoice you generate will adjust the advance received.
As per Service Tax rules, Import of services means any services provided from outside India and received in India. Tax on such services is known as Tax on Import of Services and it is the service receiver that is liable for Service Tax.
Tally.ERP 9 lets you record import of services and calculate the Service Tax.
A pure agent is a service provider who is a liaison between another service provider and a service buyer. An expense incurred by the pure agent is exempt from Service Tax.
For example, a service provider ABC has a customer XYZ who has expressed interest in buying a service not provided by ABC. ABC finds another service provider PQR who provides the service. In this transaction, ABC does not have any service liability but operates as a pure agent. Costs or expenses incurred by the pure agent should be deducted from the total service charges.
Tally.ERP 9 provides the facility to exclude the costs and expenses incurred by a service provider acting as a pure agent from total service charges, to get taxable amount.
Any consideration (something in return) received towards services provided or paid towards services received in a form other than money is called Money equivalent. Consider two service providers buying and selling services between them. Instead of paying each other for services they mutually agree to settle the liability through a form other than money. Since service tax needs to be paid on receipt of payment, in this situation service providers will pay tax on money equivalent of service exchanged.
Tally.ERP9 allows the user to record money equivalent of consideration transaction.
Situation 1: In the day-to-day transactions your accountant has made a mistake in calculating the Service Tax. This has been uncovered at the time of audit. Now your tax liability is more than what you have paid.Situation 2: You have forgotten or missed the due date for tax payment, now you need to pay the tax. Situation 3: the department has decided to change the Service Tax rate to be levied on you. Now you need to adjust your books in-order to comply.
For such arrears: in case of delayed payment, the department will charge interest on the amount due. If the department officials find that a business has intentionally defaulted or delayed tax payment then a penalty can also be charged. Penalty value will be decided by the department official as a percentage of defaulted value or equivalent or more than the value of defaulted amount, depending on the seriousness of the offence.
Tally.ERP 9 provides a facility to account for arrears, interest, penalty and other payments which will appear as ST3 report and Service Tax computation report.
If your turnover is less than Rupees eight lakhs, then the business is categorised as small service provider. Tally.ERP 9 let you record Service Tax on purchase transactions generated by you, but without the need to pay Service Tax.