Service Tac on Rent paid

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Anil Jacob (Querist)

01 April 2009 We pays rent of Rs.22000/month. Owner is not agreing to deduct any taxes. Do we need to deduct any service Taxes, or TDS from him?. if he is not agreeing, what is the impact of it?

Dayal

Dayal (Expert)

01 April 2009 TDS is deuctible by you under sec 194I when making the payment since the rent is above 120000/- on annualised basis

Service tax not chargeable as under threshold limit of 10 lacs per annum.

If the provider is not charging service tax the onus of the liability is on the provider and it does not in any way cast the burden on receiver.

Therefore you need not worry

K V Subba Rao

K V Subba Rao (Expert)

02 April 2009 I agree with Sri Dayal

(1) Service Tax: As "Service Provider", Owner is responsible.

(2)TDS:

(i) As "Payer", you are responsible to pay TDS amount u/s 194I

(ii) If Owner is not agreeing, you pay TDS amount from your funds

(iii) Manage to collect PAN No from Owner. Without this information, you will get into problem while submitting TDS Return

(iv) Do not issue Form 16-A until Owner agrees to reimburse the TDS amount to you (Of course, after remitting TDS amount, you have no right to withold issuance of Form 16-A)

Anil Jacob

Anil Jacob (Querist)

06 April 2009 Thank you so much for the information. I am not going to deduct TDS. I am not showing this rent as an expense.

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