This document outlines the Point of Taxation Rules for 2011 in India. It contains 8 main rules that determine the point of taxation (POT) for different types of transactions: Rule 2 determines the POT for payments, new levies, or tax rate changes. Rule 3 sets the general POT rule for most transactions as the earlier of the invoice date or payment date. Rule 4 addresses how to determine the POT when there is a change in the tax rate. Rule 5 covers how to handle a new tax levy. Rule 7 specifies the POT for reverse charge mechanism transactions. And Rule 8 concerns temporary transfers of intellectual property rights. The document also includes residual clauses for determining the POT if the invoice or payment dates are unavailable.

1. Point of Taxation Rules, 2011
POT Rules, 2011
Rule-1 Rule-2
Rule-2A
Dt. Of
Pymt.
Rule-2C
Continuous
supply of
Service
Rule-3
General
Rule
Rule-4
Change
in tax
rate
Rule-5
New
Levy
Rule-6
Omitted
Rule-7
RCM
Rule-8
IPR
Rule-8A
Residual
Clause
(B.J.A)

2. Rule-2A {Dt. Of Paymt.}
New Levy or
Change in rate
Credited in Bank A/c
Within 4 Working
days from Dt. of
change/levy
Earlier of
Dt. Of Book entry
Or
Dt. of credit in Bank A/c
Otherwise
Date of Credit of
Bank A/c
Otherwise
Earlier of
Dt. Of Book entry
Or
Dt. of credit in Bank
A/c

3. Rule 2C
{Continuous supply of Service}
Time taken for completion
or substantially complete
the service exceeds
3 Months
Central Govt. notified
Services
Work Contract Services
Telecommunication
Services

4. Rule-3
General
Invoice issued within 30
days from the dt. Of
Completion of service
Earlier of
Dt. Of Invoice
Or
Dt of Paymt.
Otherwise
Earlier of
Dt. Of Completion of service
Or
Dt. Of Paymt.

5. Note: Rule-3
1. Apply the Rule separately for each payment.
2. Dt. Of completion includes auxiliary services but do not include irrelevant
grounds for delay.
3. In case of CSS, apply the rule for each event separately.
4. Small advance up to Rs. 1000 /- , do not apply POT rules. POT is at the option of
Service Provider.
5. Rate of Exchange is the GAAP rate prevalent on the date of POT.

6. Rule-4 Change in Tax Rate
Date Before Change in Tax Rate Date On/After Change in Tax Rate Point of Taxation
S + I + P - Apply Rule-3
- S + I + P Apply Rule-3
S + I P I
S + P I P
I + P S Earlier of (I,P)
P S + I I
I S + P P
S I + P Earlier of (I,P)
S ---- Date of Completion of services
I ---- Date of Invoice
P ---- Date of Payment

7. Rule-5
New Levy
Dt. Of Paymt.
before dt. Of new
Levy
Invoice issued
before levy
{Rule-5 (a)}
No ST
Invoice issued
within 14 Days of
levy {Rule-5 (b)}
No ST
Invoice issue after
the date of levy
Apply Rule-3
Otherwise
Apply Rule-3

8. Rule-6 Omitted

9. Rule-7
RCM
General
No Change in tax
liability b/w dt. Of
Invoice and POT
Paymt. made
within 30 days
from the dt. of
Invoice
Date of Paymt.
Otherwise
Dt. Immediately
following the
period of 3
Months
Otherwise
Rate on the date
of invoice is
considered
Associates
+
SP in NTT
Earlier of
Dt. Of Debit in
books
Or
Dt. Of Paymt.
SP=Govt./LA
SR=Business
Entity
Earlier of
Indication of due
part/full by way of
Invoice/bill/challa
n/others by SP to
SR (Demanding
such Paymt)
Or
Dt. Paymt.

10. Rule-8
Temporary t/f of right in
Royalty
Copyright
Patents etc.
Earlier of
Date of Invoice
Or
Date of Payment

11. Rule-8A
Residual Clause.
Not able to determine POT due to
non availability of Dt. of
invoice/paymt.
CEO may ask to produce Books of
accounts, documents, others he may
deem necessary
Taking books into accounts and effective rate of tax prevalent
+
After giving an Opportunity of being heard
Shall determine POT by giving such order in
WRITTING