SERVICE TAX

This query is : Resolved

R.V.RAO

R.V.RAO (Querist)
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06 October 2007 there is a registered service provider renting immovable property.the service provider is collecting service tax.
now my question is can the service provider deduct the property tax paid on the same property from the service tax collected and deposit the balance amount of service tax.
i request for an early clarification quoting if possible any section reference or judgement or dept. notification.
thanks
R.V.RAO

Mallidi Ramabrahmananda Reddy

Mallidi Ramabrahmananda Reddy (Expert)
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07 October 2007 There is one notification No. 24/2007 dt. 22.5.2007 wherein relief for property tax paid from service tax payable is dealt. This can be looked into in the service tax site.

Gagan Agarwal

Gagan Agarwal (Expert)
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31 August 2010 the service provider needs to deduct the property tax from the rents charged and then charge service tax.

Eg. Rent Rs. 100 per month
Property tax Rs. 2 per month

Service provider should raise following invoice

Rent (Rs. 100)
Service Tax (@10%) Rs. 9.8 ((100 - 2)*10%)
Total 109.80

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