Compliance with Service Tax/GST in Banking Sector

Compliance with Service Tax/GST in Banking Sector

Source: ICAI

The banking system is also highly regulated considering its importance within the financial system in channelizing resources and helping in economic growth. Therefore ICAI has bring up the Compliance with Service Tax/GST in Banking Sector for the guidance. Banking and other Financial Services were brought under the scope of Service Tax net from 16.07.2001. Subsequently, Goods and Services Tax (GST) has been implemented from 1st July 2017 which is the biggest tax reform in India since 1947. Post GST regime the services provided by banks are subject to GST which is liable @18% instead of 15% of the earlier regime. During the financial year 2017-18 the provisions of service tax applied till June 2017 and thereafter for 9 months provisions for GST law have been made applicable since July 2017.

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Compliances of GST in Banking Sector: ICAI

Considering that no significant material was available for providing guidance to the members to check the compliance of service tax/GST in the banking sector. The Indirect Taxes Committee of ICAI is coming with this e-publication ‘Compliances with Service tax/GST in Banking Sector’. This publication analyzes the provisions of the law in respect of Income earned by banks, expenses incurred by banks, CENVAT Credit /Input, Routine procedural checks, Questionnaire for Service/GST Tax Audit of Banks etc. The e-publication will assist members to verify the service tax/GST compliance by Banks, especially when doing the Bank Branch/Central Statutory and Concurrent Audit.

Download the full Compliance with Service Tax/GST in Banking Sector in Pdf.