There has been different rates of interest on service tax dues on different periods. Here under given Interest rates applicable from 01.04.2011 on wards
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Effective Date
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Period of delay
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Rate of simple interest
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01.04.2011
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In Case Service Provider has turnover exceeding 60Lacs
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18% on the days of delay calculated on daily basis
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In all other cases
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15% on the days of delay calculated on daily basis
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01.10.2014
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Upto 6 months
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18% on the days of delay calculated on daily basis
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More than 6 months upto 1 year
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18% for first 6 months and on balance period of delay upto 1
year @24%
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Delay for more than 1 year
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18% for first 6 months and on balance period of delay upto 1
year @24% and on balance delayed period after 1 year @30%
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14.05.2016
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Collection of Service Tax but not deposited to Govt Account
before the due date
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24% on days of delay after the due date
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Other than above situation
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15% on days of delay after the due date
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Notes :
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1. As per Section 75 of Finance Act 1994 in case the Service Tax
provider has turnover not exceeding 60
lacs in any financial year under notice or preceding Fin Year is given rebate
of 3% and effective rate of interest
will be 12%
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2. As per Service Tax Act interest payments are mandatory in
nature and such interest demands on delay can not be waived.
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3. The Provisions of Section 75 Finance Act 94 the interest provisions
for delay in payment of service tax is applicable in case of reverse charge
mechanism also for the service receiver to pay interest on delay in payment
of dues of service tax.
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