service tax or tax under PGBP?
This query is : Resolved
17 April 2017
If a person is engaged in running gym then please help me in letting me know whether he would be liable for ST or PGBP?
CA Shubhanshu Jain
(Expert)
19 April 2017
He would be liable for both as both are different, as service tax is indirect tax and income tax is direct tax
Now first let us understand what is difference between direct tax and indirect tax
- Direct Tax is the one which is levied directly on the income of the person for eg : - Income tax, Wealth Tax
- Indirect tax is the tax which is imposed on goods and services i.e person manufacturing/selling goods or supplying services collects tax from person purchasing from him or availing services from him and deposit same with government. Examples of indirect taxes are service tax, VAT, Excise duty
Since person running GYM is providing services to his clients hence service tax is to be charged on fees taken from users and deposit same with government, However if such person has taken some services on which he has also paid service tax then he can claim benefit of same. For eg: Person running GYM collect fees of Rs. 12,00,000 on which service tax liability is lets suppose Rs. 2,00,000 and running GYM he has taken few services on which he has paid service tax of Rs. 40,000 so net tax Payable to government is Rs. 1,60,000 (200000-40000)
And as far as PGBP is concerned which is income tax so this is to be paid as per provisions of income tax Act.
Now first let us understand what is difference between direct tax and indirect tax
- Direct Tax is the one which is levied directly on the income of the person for eg : - Income tax, Wealth Tax
- Indirect tax is the tax which is imposed on goods and services i.e person manufacturing/selling goods or supplying services collects tax from person purchasing from him or availing services from him and deposit same with government. Examples of indirect taxes are service tax, VAT, Excise duty
Since person running GYM is providing services to his clients hence service tax is to be charged on fees taken from users and deposit same with government, However if such person has taken some services on which he has also paid service tax then he can claim benefit of same. For eg: Person running GYM collect fees of Rs. 12,00,000 on which service tax liability is lets suppose Rs. 2,00,000 and running GYM he has taken few services on which he has paid service tax of Rs. 40,000 so net tax Payable to government is Rs. 1,60,000 (200000-40000)
And as far as PGBP is concerned which is income tax so this is to be paid as per provisions of income tax Act.
21 April 2017
Thanks Shubanshu, however, as far as Service tax is concerned then one of my friend Peter already said "if total amount of service is less than 10lac then ST will not be applicable". Please take a look at this..
CA Shubhanshu Jain
(Expert)
21 April 2017
Yes if services provided by you is less than 10 lakhs in previous year then service tax is not levied
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Accounting treatment of AMC alongwith the purchase of Laptop
- Condonation Request sec 119(2) b -Enhancement Limit of Leave Exemption prior to AY 2023
- Unable to File TDS Q2 Return – New TRACES Portal Error
- Transfer of Physical Stock Between Two Proprietorship Concerns
- Issuing of delivery challan by seller of goods
- Not ordinarily resident having partnership income in India and salary in USA is any form to filed be
- Taxation of crypto futures in India Fy 2026- 2027
- GST Treatment of Purchases with GST Paid where Outward Supplies of Manufactured CattleFeed Exempt
- EPF ECR NEW RULES Sep 17th 2026
- Expert Help Required for TDS Refund 100000 Through TRACES – AY 2022–23
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
