Reg:Service Tax treatment
This query is : Open
Priya Sharma
(Querist)
06 January 2010
One of the Service Provider has developed online cinema tickets booking services online,say A(Service Provider). Now A is providing services to Theatre B for assisting in the online booking of tickets.
The actual price of the ticket is Rs. 50/-per ticket.Now when the tickets are sold online, it costs Rs. 60/- to the viewers.This Rs.10/- is the service charge charged by A, the service provider, which is to be paid by B, the theatre owner.
Out of Rs. 10/- the Service Provider will keep Rs. 7 and give away Rs. 3 to the Theatre owner.
Rs. 3/- is in the nature of revenue sharing.
Now my query is on what amount, the Service Tax should be charged???On Rs. 7/- or on Rs. 10/-???
Kindly suggest, its urgent.
Regards
Priya Sharma
The actual price of the ticket is Rs. 50/-per ticket.Now when the tickets are sold online, it costs Rs. 60/- to the viewers.This Rs.10/- is the service charge charged by A, the service provider, which is to be paid by B, the theatre owner.
Out of Rs. 10/- the Service Provider will keep Rs. 7 and give away Rs. 3 to the Theatre owner.
Rs. 3/- is in the nature of revenue sharing.
Now my query is on what amount, the Service Tax should be charged???On Rs. 7/- or on Rs. 10/-???
Kindly suggest, its urgent.
Regards
Priya Sharma
CA Tilak Raj Sharma
(Expert)
06 January 2010
Rs. 7 as it is net amount of income or commission received by the service provider.
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