As per Rule 4A(1) of Service Tax Rules, 1994 every person providing a taxable service is required to issue an invoice or bill signed by such person or a person authorized by him in respect of taxable service provided or to be provided by him and such invoice or bill, as the case may be.

The invoice, bill or challan must be issued within thirty days from date of completion of taxable services or receipt of any payment towards the value of such taxable services, whichever is earlier. In case of banking and other financial services, they can issue invoice within 45 days as per rule 4A(1) as amended w.e.f. 01.04.2012. Invoice, bill or challan is required to be issued even when advance is received, even if service is to be provided later.

Details required to be shown in invoice/bill/challan – As per rule 4A(1), the invoice/challan/Bill should be(a) signed by authorized person of provider of input services (b) should be serially numbered and (c) should contain following details –

  1. Name, address and registration number of person providing taxable services
  2. Name and address of person receiving taxable service
  3. Description and value of taxable service provided or agreed to be provided and
  4. Service tax payable on the taxable service

The service tax collected must be shown separately in Invoice/Bill raised by the person providing services.

Invoice in case of continuous supply of service: – Some services like construction services, telephone services, renting services are provided for a continuous period exceeding three months. The provision provides that in case of continuous supply of service, every person providing such taxable service shall issue and invoice, bill or challan, as the case may be, within thirty days of the date when each event specified in the contract, which requires the service receiver to make any payment of service provider is completed.

Invoice when advance is received: – As per Rule 4(A) of Service Tax Rules provides that every person providing taxable service shall issue an invoice, bill or challan within 30 days from the date of completion of such service or receipt of any payment towards value of taxable services, whichever is earlier. Invoice is required even when advance is received.

Digitally signed invoice: – In the Union Budget 2015, an option to maintain records in electronic form and authenticate the same by digital signature subject to conditions, safeguards and procedures prescribed by the Board was given to the assessee. Subsequent to the provision an instruction is given for the manner of verification of the electronic records by the department is given vide Notification No.  18/2015-Central Excise (N.T.) dated 6th July, 2015. At present the maintenance of record in electronic form is an optional.

(The above article is authored by Ganeshan Kalyani and he can be reached via email on gganeshan.k@gmail.com).

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16 responses to “Provisions related to Issue of Invoice under Service Tax”

  1. Ajay P says:

    I forgot to raise the Bills for ‘Renting of immovable property’ to my tenant from past three years.
    But I have paid service tax for the entire period to the government on time.
    My tenant had paid me the rent on monthly basis, whereas he is denying to pay me service tax now, as I have not submitted the Bills on time.
    How can I recover the service tax amount from my tenant.

  2. AJay says:

    Dear Sir
    I Have Made 2-Invoice with same no.(for Ex. 001) One Invoice Is Including Service Tax & other Is Invoice of sez area where tax is not claimed & I Have Recieved Both Payment How To Show it in Service Details

  3. anshu kumar says:

    i raised invoice for apr,may,june,july and aug on 22-oct and got payment on 12-jan
    my company is a proprotor ship and turn over is below 50-lakh
    on 24-jan i raised invoice for oct nov and dec also
    i also filed nil return for first half year please suggest me
    when i can deposit service tax without late fine

  4. Sanjay yadav says:

    Hello sir
    We have a 2 address, one registerd office in delhi
    & working office in Meerut (U..P) AND service tax number we take from delhi…..if any party gives us the invoice on Meerut address than can we take the input credit on that invoice on not?

  5. shonali says:

    I have started a new business and registered service tax without crossing a revenue of 10lakhs. I am taking taxes from my clients for the services. Is this ok to go ahead with. Please suggest

  6. Sandya says:

    I have raised a tax invoice last month and paid service tax for the same, now when the client asked for discount i have changed the amount. So i want to know the consequences and remedies for the same. Can anyone please help me for this?

    • Aravind says:

      Hello Sandya!

      You can adjust the excess paid ST later if amount is renegotiated. However, to be able to adjust, you shall raise a credit note. Only then, you can adjust. Further, there is no time limit for this type of adjustments.

  7. Sanjana says:

    If i have not raised ST for a particular invoice and I raise a separate invoice for it?

  8. Ganeshan says:

    If service is provider after change is service tax rate and payment is also received after change in service tax rate but invoice is raised before change in service tax rate, then new service tax rate, presently 14% will be applicable.

  9. Ganeshan says:

    If the service completed and payment received is after change in service tax rate then new service tax rate will be applicable. Since you have already paid service tax on advance received you can pay service tax on differential amount at new rate.

  10. Ganeshan says:

    Yes service provided by Bank is a taxable service

  11. Ganeshan says:

    The Director managing day to day business activity and is paid salary then service tax under reverse charge is not applicable. the amount so paid to Director would be in employee-employer relationship. If the Director is paid sitting fees for Annual General Meeting then it is in the nature of service and service tax under reverse charge is applicable. service tax would be paid @14% on 100% of value by a corporate body.

  12. Mohan Shah says:

    Dear sir,
    Please let me know Director Remuneration under company eligible of RCM service tax if yes let me know how % of RCM service tax.

    Regard,
    Mohan Shah
    +91 9860743171

  13. RAJEEV KUMAR says:

    hi sir
    if invoice issue(advance) before service provide and amount received so please suggest me when service tax consider.

  14. Sachin Pawar says:

    Sir,
    If service provider received an advance and he paid service tax on advance received as per existing service tax rate. But invoice is raised within 30 days of after completion of service. What will happen if service tax rate is different on the day service is completed. That means service tax rates got changed between advance received and service completed period. Please guide.

  15. Narendra K Agarwal says:

    dear Ganeshanjee,

    Is Bank is suppose to service tax even when debited directly in the bank account sir.please reply on my email Id or let me know how i should view the reply sir

    regards,
    Narendra K AGarwal
    9833678339

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