Charging service tax

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

06 June 2013 Dear Experts,

Service tax registration is obtained voluntary i.e before turnover crossing 10 Lakhs....

Now in case of rented premises (Service category is renting of immovable properties) is it allowed that service tax is charged to some tenants and not to others...

RENGARAJ R.K

RENGARAJ R.K (Expert)
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06 June 2013 It is good that you have taken RC voluntarily. Once you started charging service tax in the bills after obtaining RC you cannot avail exemption on one tenant and collect from other tenant.

Please note that only rental income from commercial purpose is taxable.

Municipal tax paid on your proprerty is allowed for deduction while remitting service tax on rental income from the particular immovable property.

Querist : Anonymous

Querist : Anonymous (Querist)

06 June 2013 Thanks sir.....But what abt Municipal Tax in foll cases:

- Premises is given to more than 1 tenant...then it can be adjusted against total service taxable value?

- If entire premises is not given on rent i.e. only partly rented then how to arrive at municipal tax paid benefit...is it based on area?

Querist : Anonymous

Querist : Anonymous (Querist)

06 June 2013 Thanks sir.....But i have some queries with respect to a practical case...

- Since only commercial property is taxable..in my case ground floor of a premises is rented for commercial purpose whereas 1st floor of the same premises is rented to the same company for residential dwelling of its staff...with seperate agreement...then is service tax applicable on both?

- Also municipal tax paid can be claimed proportionately i.e entire premises is not rented....based on area benefit can be taken?