Is tds deducted on service tax

This query is : Resolved

Chetan Sharma (Querist)
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19 April 2013 IF A PROFESSIONAL RAISES A BILL OF A PARTICULAR AMOUNT AND CHARGES SERVICE TAX ON IT. THEN WHILE MAKING PAYMENT IS TDS DEDUCTED ON THE GROSS AMOUNT OR ON THE NET AMOUNT (INCLUDING SERVICE TAX).

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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19 April 2013 As per Circular No.4/2008 dated 28.4.2008, it was clarified that TDS on rental payments would be required to be made only on the basic rental amount without including service tax. In other words, TDS should not be made on the service tax portion of the rent. However, this analogy is not applicable to TDS under other sections.

In short--
For 194I - Deduct TDS on amount excluding service tax.
For other section - Deduct TDS on amount including service tax.

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CA PRAVEEN SINGH

CA PRAVEEN SINGH (Expert)
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19 April 2013 Yes. Agree with above expert.

CA.Sourabh Sethia

CA.Sourabh Sethia (Expert)
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19 April 2013 As the Section 194I

Any person, not being an individual or a Hindu undivided family, who is responsible for paying any income by way of rent

since the word is specific about Income

but in Section 194J

Any person, not being an individual or a Hindu undivided family, who is responsible for paying any sum by way of fees for professional services

here the word is any sum paid which includes Service Tax
So the service tax is to be included while deducting TDS