Face book ads

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 August 2012 ours is a social media firm, we prepare ad for our client and put it on face book.
face book charge us on daily basis on heat it received for particular ad and in turn we collect the said amount at the month end from our client, and over that we collect 10% as managemt fees.
1) we charge service tax on full amount bu some client is arguing that what ever actual ad spent they pay us that is just re-imbursement of what we have pai to face book. so is it ok if w donot charge service tax on ad spent actual amount re-imburse by client.
also i want to know whether ngative list publised by s.tax dept.exempt internet ads from sevice tax.if so does face books ads also exempted from service tax
thanks in advance.

CA Suresh Jain

CA Suresh Jain (Expert)
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15 August 2012 1. Since you are billing advertisement charges as well management fees, you have to pay service tax on both, if face book bills directly to your client then you need not bill and collect service tax
2. internet service is neither in negative list nor exempted

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