Service tax on rental income to co-owners
This query is : Resolved
11 August 2013
I have a query regarding servicetax on rental income to co-owners.
Explanation of the case:
mother and daughter has co-ownership in one building. they made rental agreement
with reebok show room in 2008-09 onwards,with rent of rs 120000 per month to both of them.
tenants are deducting TDS to both co-owners separately and paying rental income through cheques separately,to each of them indivisually rs 60000 per month.
indivisual shares are not attracted to service tax but togater rental income is attracting service tax,recently they got notice from CBEC to show all the details of rental income from FY 2008-09 to FY 2012-13.
IS THEY ARE LIABLE TO PAY SERVICE TAX?
Please provide a clarification regarding this case.
Thank you.
CA K PRAVEEN REDDY
8143715871
Explanation of the case:
mother and daughter has co-ownership in one building. they made rental agreement
with reebok show room in 2008-09 onwards,with rent of rs 120000 per month to both of them.
tenants are deducting TDS to both co-owners separately and paying rental income through cheques separately,to each of them indivisually rs 60000 per month.
indivisual shares are not attracted to service tax but togater rental income is attracting service tax,recently they got notice from CBEC to show all the details of rental income from FY 2008-09 to FY 2012-13.
IS THEY ARE LIABLE TO PAY SERVICE TAX?
Please provide a clarification regarding this case.
Thank you.
CA K PRAVEEN REDDY
8143715871
11 August 2013
No ,because the threshold exemption limit of Rs.10 lakh is applicable per service provider and not per service.
Ref:- Notification No. 6/2005-ST dated 1.3.2005 and 08/2008-ST dated 1.3.2008.
Citation:- Dinesh K Patwa, Shrerik. K Patwa & Others Vs CST, Ahmd. STO (2012) CESTAT 474.
Ref:- Notification No. 6/2005-ST dated 1.3.2005 and 08/2008-ST dated 1.3.2008.
Citation:- Dinesh K Patwa, Shrerik. K Patwa & Others Vs CST, Ahmd. STO (2012) CESTAT 474.
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