Service tax numbers quoted on bills must be verified. Frequently, entities have provided incorrect service tax numbers and pocketed the revenue.If you find a particular vendor doing this, you can report them to the authorities. If you can identify a particular vendor that is conducting this kind of activity, you may be able to report them to the authorities. Verifying the assessee is very simple, provided you know what you are trying to accomplish.

3 Easy Steps for Assessee Verification

1. As a first step, simply visit the website of the Central Board of Excise and Customs.
2. In the bottom right of your screen, you will find an option for an Assessee-Code-based Search.
3. Now simply enter the 15-digit code and clear image verification. You can find both central excise and service tax assessees through this method.

The following information will be provided to you:

1. Name of the Assessee
2. Address of the Assessee
3. Location Code

How to Understand Service Tax Number Structure?

The Service Tax Code Number is a 15-digit code, based largely on the PAN number of the assessee. The first 10 digits are the same as the PAN, while digits 11 and 12 are designated as ST or SD. If you have applied for just one number against a single PAN, then the next three digits will be 001, completing the 15-digit code. The Service Tax Code is particularly important in the context of service tax applications. However, with the introduction of the GST system, entities now need to consider obtaining a new GST registration as well, which simplifies tax compliance by integrating various taxes into a single framework. This new GST registration is crucial for businesses to manage their tax obligations efficiently under the new tax regime, ensuring they are fully compliant and able to take advantage of input tax credits.

Also, get to know how to verify your PAN number & check your PAN card status.

This is also the case for Central Excise number (major account head 38), which is a 15-digit code:

1. Digits 1 to 10 will be the PAN or TAN Number.
2. Digits 11 and 12 will be XM.
3. Digits 13 to 15 will be the number of registrations issued against that PAN or TAN, starting with 001.

In the case of Service Tax Number, it will follow this pattern:

1. Digits 1 to 10 will be the PAN Number.
2. Digits 11 and 12 will be ST or SD.
3. Digits 13 to 15 will be the number of registrations issued against that PAN, starting with 001.

Gain financial clarity instantly! Explore our GST Calculator for accurate tax estimations.

Common Methods of Service Tax Fraud

Three years ago, the Finance Ministry published a report on Service Tax fraud, in which it noted that certain industries are more prone to service tax fraud than others. The main sectors accused of service tax fraud were general insurance, banking, and other financial services, work contracts and immovable property leasing are prone to service tax evasion. The major reasons for fraud are as follows:

1. Availing of CENVAT Credit 

The CENVAT Credit scheme allows service providers to set off taxes paid on raw materials or input services against the taxes to be paid on the service provided. Service providers have been found to overstate the amount of tax paid on input services or even include taxes unrelated to the service.

2. Non-registration 

All entities that are liable to pay service tax must register themselves when their revenues hit ₹. 9 lakh. They must start collecting service tax on touching ₹. 10 lahks in revenue. Many service providers (freelancers included) neglect to do so, ending up in the net of the tax authorities.

3. Non-payment of Service Tax 

This is the main reason you should verify a service tax number, as service providers may give you an incorrect service tax number and simply pocket the money. Even Kingfisher Airlines stands accused of non-payment of ₹ 76 crore worth of service tax.

4. Undervaluation of Services 

This is non-payment, too, in a way, but more difficult to spot. As the paperwork involved in spotting businesses that are undervaluing their services in order to pay less tax, it is common for businesses to do so and keep the difference paid by their customers for themselves.

For these reasons, an Assessee Verification should be part of the process any business follows while making a payment.

Assessee Verification Steps for Service Tax Registration 

• Visit the Central Board of Excise and Customs website 
• Enter the 15-digit code and complete the image verification step 

This method will allow you to find both service tax assessees and central excise assessees. The information provided will include:

• Assessee’s Address
• Assessee’s Name
• Location Code

Conclusion 

We trust that our detailed explanation on verifying a service tax number has provided you with the clarity and insights you need. At Vakilsearch, we are dedicated to offering expert guidance and support for all your tax-related queries and compliance needs. If you have any further questions or require additional assistance, our team of professionals is here to help. Please feel free to leave your comments or reach out to us directly. We are committed to ensuring you receive the best support and solutions tailored to your specific needs.

Frequently Asked Questions

Who has to pay service tax?

Service tax is payable by individuals or entities that provide taxable services in India. This includes businesses and professionals offering services like consulting, legal, and technical assistance. The liability falls on the service provider, who must collect the tax from the recipient and remit it to the government.

What are taxable services?

Taxable services include a wide range of activities such as advertising, telecommunications, banking, insurance, and consultancy services. The scope is broad, covering most services offered for a consideration. Specific details and exemptions can be found in the service tax regulations and related notifications.

What is the rate of service tax in India?

The standard rate of service tax in India was 18%. However, rates can vary based on specific services or changes in tax laws. Always consult the current tax guidelines or a tax professional for the most accurate information.

How long does it take to get a service tax registration?

Getting service tax registration typically takes about 7 to 15 working days, provided all required documents are submitted accurately. The duration may vary based on the efficiency of the tax authority and the completeness of the application submitted.

Is there a penalty charged for not obtaining service tax registration?

Any failure to do so or delay in registering will result in a penalty that, depending on which sum is bigger, might increase to either ₹5,000 or ₹200 for each day that passes without any indication of registration. The guidelines outlined in Finance Act Section 77(1)(a) govern the imposition of this penalty.