Service tax on rent
This query is : Resolved
Rajesh Chadda
(Querist)
28 May 2013
I am running my car ageny on rental property. I am giving rent to 4 different poples but my total rent for the year is 24.00 lac. A cheque of Rs 50000 is given to every person every month.
(1)Is there is any liabiliity of Service Tax in My hands ?
(2)Is there is any liability of Service Tax in Hands of Land Lord
(1)Is there is any liabiliity of Service Tax in My hands ?
(2)Is there is any liability of Service Tax in Hands of Land Lord
Rupesh Jain
(Expert)
28 May 2013
if property in name of 4 person and each recd. Rs. 180000/- Per year then NO tds to be deducted otherwise 10% of Rent to deducted.
if any co-owner have no PAN then 20% TDS to be deducted and deposited
if any co-owner have no PAN then 20% TDS to be deducted and deposited
Rajesh Chadda
(Querist)
28 May 2013
Sir my query is regarding service tax pls clarify
Rajesh Chadda
(Querist)
28 May 2013
Query is not related to TDS
Rajesh Chadda
(Querist)
28 May 2013
Pls clarify
24 July 2025
Got it! Here's a clear explanation regarding **service tax on rent** for your situation:
---
### Your situation:
* You run a car agency on a rented property.
* You pay rent to **4 different landlords**.
* Total rent paid annually = Rs. 24 lakhs.
* Each landlord receives Rs. 50,000 per month = Rs. 6 lakhs per year each.
---
### (1) **Is there any Service Tax liability on your side (the tenant)?**
* No, **service tax on renting of immovable property is payable by the owner/landlord**, not by the tenant.
* As a tenant, you don’t have any service tax liability on the rent you pay.
---
### (2) **Is there any Service Tax liability on the landlords’ side?**
* Yes, **each landlord has to see if their individual rental income exceeds Rs. 10 lakhs per annum threshold for service tax registration and payment**.
* Since each landlord receives Rs. 6 lakhs annually (Rs. 50,000 x 12), which is **below Rs. 10 lakhs threshold**, **there is no service tax liability on each landlord individually**.
* **However, if any single landlord receives more than Rs. 10 lakhs per year as rent, that landlord must register and pay service tax.**
---
### Summary:
| Person | Rent Received (Annual) | Service Tax Liability? |
| ----------------- | ---------------------- | ------------------------------------------------ |
| Each landlord (4) | Rs. 6,00,000 | **No** (below Rs. 10 lakh threshold) |
| You (tenant) | Paying Rs. 24,00,000 | **No** (tenant does not pay service tax on rent) |
---
### Additional Notes:
* This is under pre-GST regime (Service Tax).
* Landlords must check individually whether they cross the threshold.
* Also check TDS (Tax Deducted at Source) rules on rent payments.
---
If you want, I can also help explain how TDS applies or if you want info on GST implications post-service tax era.
Does that clear things up?
---
### Your situation:
* You run a car agency on a rented property.
* You pay rent to **4 different landlords**.
* Total rent paid annually = Rs. 24 lakhs.
* Each landlord receives Rs. 50,000 per month = Rs. 6 lakhs per year each.
---
### (1) **Is there any Service Tax liability on your side (the tenant)?**
* No, **service tax on renting of immovable property is payable by the owner/landlord**, not by the tenant.
* As a tenant, you don’t have any service tax liability on the rent you pay.
---
### (2) **Is there any Service Tax liability on the landlords’ side?**
* Yes, **each landlord has to see if their individual rental income exceeds Rs. 10 lakhs per annum threshold for service tax registration and payment**.
* Since each landlord receives Rs. 6 lakhs annually (Rs. 50,000 x 12), which is **below Rs. 10 lakhs threshold**, **there is no service tax liability on each landlord individually**.
* **However, if any single landlord receives more than Rs. 10 lakhs per year as rent, that landlord must register and pay service tax.**
---
### Summary:
| Person | Rent Received (Annual) | Service Tax Liability? |
| ----------------- | ---------------------- | ------------------------------------------------ |
| Each landlord (4) | Rs. 6,00,000 | **No** (below Rs. 10 lakh threshold) |
| You (tenant) | Paying Rs. 24,00,000 | **No** (tenant does not pay service tax on rent) |
---
### Additional Notes:
* This is under pre-GST regime (Service Tax).
* Landlords must check individually whether they cross the threshold.
* Also check TDS (Tax Deducted at Source) rules on rent payments.
---
If you want, I can also help explain how TDS applies or if you want info on GST implications post-service tax era.
Does that clear things up?
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