Applicability of service tax on water and parking charges!

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Madhusudhana Navada (Querist)
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01 August 2013 We have let out Commercial Building to 10 different tenants and in the lease agreement we clearly mentioned Rent, Maintenance Charges, Parking Charges (Covered), and Fixed Water charges. Whether Service Tax will applicable on Parking Charges (Covered Area) and Fixed Water charges?? Whether we have to raise two separate bills for rent and Maintenance Charges? We would like know whether Water charges and Parking Charges Collected will come under Maintenance Charges? Please clarify.

CA Suresh Jain

CA Suresh Jain (Expert)
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02 August 2013 A plain reading of your query suggests that the charges taken by you are all taxable.

To save on tax on maintenance charges the tenants to take the responsibility of maintenance, form an association or without even an association contribute their share to total expenditure. If association is formed the service tax shall be applicable if amount payable exceeds Rs. 5000.00 per month.

To save tax on water expenses the same should be charged on actual

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