We know that after implementation of GST w.e.f 01.07.2017, service tax no longer exist. However audit and assessment of service tax cases continues even after 01.07.2017 and in case of any demand applicable interest has to be paid.
Interest calculator for delay in payment of service tax is attached which can calculate interest in one shot for different period.
Interest is levied on the assessee when he delays the payment of service tax which is due and payable. The rate of interest u/s 75 of Finance Act 1994 has undergone a lot of changes since 01.07.1994.The summary of rate of interest is as below:
| Period | Rate of Interest |
| 01.07.1994 to 15.07.2001 | 1.50% per month or part there of |
| 16.07.2001 to 15.08.2002 | 24% per annum |
| 16.08.2002 to 09.09.2004 | 15% per annum |
| 10.09.2004 to 31.03.2011 | 13% per annum Notification No. 26/2004-ST dated 10.09.2004 |
| 01.04.2011 to 30.09.2014 | 18% per annum : Notification No. 14/2011- ST, dated 01/03/2011 |
| 15% per annum (For assessees having turnover upto Rs 60 lakhs) | |
| 01.10.2014 to 13.05.2016 * | Notification No. 12/2014 dated 11.07.2014 |
| 1. 18% p.a.- Delay for first 6 months | |
| 2. 24% p.a. – Delay from 7th month to 12 month | |
| 3. 30% p.a. – Delay for the period beyond 1 year | |
| 14.05.2016 onwards * | NOTIFICATION NO.13/2016-ST, DATED 01.03.2016 |
| 24% per annum : Service Tax collected but not paid before due date | |
| 15% per annum : Service tax not collected and not paid |
* In the case of a service provider, whose value of taxable services provided in a financial year does not exceed sixty lakh rupees during any of the financial years covered by the notice or during the last preceding financial year, as the case may be, such rate of interest, shall be reduced by three per cent. per annum.] [ Refer Section 75 of Finance Act, 1994]
The summary of rate of service tax applicable for different period is also given below:
| Period | Rate |
| 01.07.1994 to 13.05.2003 | 5.00% |
| 14.05.2003 to 09.09.2004 | 8.00% |
| 10.09.2004 to 17.04.2006 | 10.20% (ST+EC) |
| 18.04.2006 to 10.05.2007 | 10.24% (ST+EC) |
| 11.05.2007 to 23.02.2009 | 12.36% (ST+EC+SHEC) |
| 24.02.2009 to 31.03.2012 | 10.30% (ST+EC+SHEC) |
| 01.04.2012 to 31.05.2015 | 12.36% (ST+EC+SHEC) |
| 01.06.2015 to 14.11.2015 | 14% (ST) |
| 15.11.2015 to 31.05.2016 | 14.50% (ST+SBC) |
| 01.06.2016 onwards | 15.00% (ST+SBC+KKC) |
Example 1) Mr X (turnover above Rs 60 lacs) has paid the service tax of Rs 1,00,000 due for the month April 2012 (due on 06.05.2012) on 10.04.2018. In such a case he need to pay interest of Rs 1,37,655 for delay of 2165 days. (Service tax collected but not paid)
| Period | Rate of Interest | No of days | Amount of Interest |
| 01.04.2011 to 30.09.2014 | 18% per annum | 877 | 43,249.32 |
| 01.10.2014 to 13.05.2016 * | |||
| – 1st 6 months | 1st 6 months = 18% P.A, 7th month to 12 month = 24% P.A, Beyond 1 year = 30% P.A |
0 | – |
| – 7th month to 12 month | 0 | – | |
| – period beyond 1 year | 591 | 48,575.34 | |
| 14.05.2016 onwards * | 24% per annum | 697 | 45,830.14 |
| 2165 | 137,654.79 |
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