POINT OF TAXATION RULES, 2011
Point of Taxation Rules was applicable w. e.f 1st April, 2011. These rules were introduced to convert the
service tax payment system from ‘payment basis’ to ‘accrual basis’. Before 1st April 2011, the Input of
service tax can be claimed only after making the payment and similarly the service tax payment liability
arise only after receiving the payment. This will increase the accounting work and complexity in
maintaining the records. Further this system is not consistent with the excise and VAT laws. To bring the
consistency among the various laws and to facilitate the implementation of GST the Point of Taxation
rules were introduced. The brief the applicable rules as on date is as under:-
Rule 1 : Short title and Commencement.
Rule 2 : Definitions
Rule 2A : Date of payment
Rule 3 : Determination of point of taxation
Rule 4 : Determination of point of taxation in case of change of rate of tax
Rule 5 : Payment of tax in cases of new services
Rule 6 : Omitted
Rule 7 : Determination of point of taxation in case of specified services or persons
Rule 8 : Determination of point of taxation in case of copyrights, etc
Rule 8A : Determination of point of taxation in other cases.
Rule 9 : Transitional Provisions
Rule 10 : Notwithstanding anything contained in the first proviso to rule 7
Point of Taxation Rules was applicable w. e.f 1st April, 2011. These rules were introduced to convert the
service tax payment system from ‘payment basis’ to ‘accrual basis’. Before 1st April 2011, the Input of
service tax can be claimed only after making the payment and similarly the service tax payment liability
arise only after receiving the payment. This will increase the accounting work and complexity in
maintaining the records. Further this system is not consistent with the excise and VAT laws. To bring the
consistency among the various laws and to facilitate the implementation of GST the Point of Taxation
rules were introduced. The brief the applicable rules as on date is as under:-
Rule 1 : Short title and Commencement.
Rule 2 : Definitions
Rule 2A : Date of payment
Rule 3 : Determination of point of taxation
Rule 4 : Determination of point of taxation in case of change of rate of tax
Rule 5 : Payment of tax in cases of new services
Rule 6 : Omitted
Rule 7 : Determination of point of taxation in case of specified services or persons
Rule 8 : Determination of point of taxation in case of copyrights, etc
Rule 8A : Determination of point of taxation in other cases.
Rule 9 : Transitional Provisions
Rule 10 : Notwithstanding anything contained in the first proviso to rule 7