Laibility of service tax on renting of immovable property
This query is : Resolved
31 December 2012
Dear All,
I want to know that whether the meaning of "aggregate value not exceeding 10 lakhs". we are in the business of manufacturing & trading not a service provider but now we are going to renting our a immovable property to a company...our turnover in previous year is more than 10 lakhs without rental income. so, what will be the service tax applicable on us or not..our rental income will be 9,60,000.00 p.a.?
Pls help.
I want to know that whether the meaning of "aggregate value not exceeding 10 lakhs". we are in the business of manufacturing & trading not a service provider but now we are going to renting our a immovable property to a company...our turnover in previous year is more than 10 lakhs without rental income. so, what will be the service tax applicable on us or not..our rental income will be 9,60,000.00 p.a.?
Pls help.
31 December 2012
Yes, Service tax will be applicable in your case since you have already got or could have got exemption from service tax for first 10 lakhs in the last year only.
In the current year, you will not get exemption from service tax.
In the current year, you will not get exemption from service tax.
31 December 2012
In my view, though your turnover exceeds 10 lakhs but it is not from taxable services, therefore, you are eligible for small scale service provider benefit under Notification No. 33/2012 (earlier 6/2005).
This view can supported with definition of “aggregate value” means the sum total of value of taxable services charged in the first consecutive invoices issued during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66B of the said Finance Act under any other notification. Thus, when the aggregate value does not include exempted services, how can we assume it includes trading and manufacturing activity, which is not even chargeable to service tax. Thus, you are not liable to pay service tax but you have to take registration as your turnover from taxable services exceeds Rs. 9 lakhs.
This view can supported with definition of “aggregate value” means the sum total of value of taxable services charged in the first consecutive invoices issued during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66B of the said Finance Act under any other notification. Thus, when the aggregate value does not include exempted services, how can we assume it includes trading and manufacturing activity, which is not even chargeable to service tax. Thus, you are not liable to pay service tax but you have to take registration as your turnover from taxable services exceeds Rs. 9 lakhs.
01 January 2013
Dear Mr. Nitesh,
I agree with the answer given by Mr Arun. I have misread your question. i read as it is turnover from renting of immovable property.
there is no service provided by you in the last year so no service tax in the current year.
I agree with the answer given by Mr Arun. I have misread your question. i read as it is turnover from renting of immovable property.
there is no service provided by you in the last year so no service tax in the current year.
02 January 2013
Thanks to both of You...
“Aggregate value” means the sum total of value of taxable services charged in the first consecutive
invoices issued during a financial year…..” emphasizes first consecutive invoices issued during a financial year,
and this exemption will be computed from 1st July, 2012 as invoices issued for non taxable service in the financial
year cannot be included in the aggregate value. It is clear from the words used in the definition of aggregate
value…..” the sum total of value of taxable services charged in the first consecutive invoices issued during a
financial year…..”
I am very very thankful to u...
“Aggregate value” means the sum total of value of taxable services charged in the first consecutive
invoices issued during a financial year…..” emphasizes first consecutive invoices issued during a financial year,
and this exemption will be computed from 1st July, 2012 as invoices issued for non taxable service in the financial
year cannot be included in the aggregate value. It is clear from the words used in the definition of aggregate
value…..” the sum total of value of taxable services charged in the first consecutive invoices issued during a
financial year…..”
I am very very thankful to u...
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