Service tax paid on Rent

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Sachin Jain (Querist)
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13 August 2007 Will Service Tax paid on Rent be allowed as deduction while calculating the Exemption U/S 10(13A). If yes, is it mandatory to show service tax seperately on the Rent Receipt? Whether the treatment will differ if it is not shown seperately on the Rent Receipt.( please answer from the point of view of Salaried Person)

D.C AHUJA

D.C AHUJA (Expert)
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13 August 2007 Yes you can claim subject to other restrictins on calculations as per Income Tax Act.

Sachin Jain

Sachin Jain (Querist)
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13 August 2007 Ahuja sir thanks for your reply. May i know what are the other restrictions that are imposed by the Income Tax Act.

Raj

Raj (Expert)
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14 August 2007 But Service tax on rent should be for Rent for Business/commercial Purpose .from where question about sec.10(13A) is coming

CA Mani

CA Mani (Expert)
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14 August 2007 See Sachin,

Rent is inclusive of service tax and in the rent receipt it need not be shown separately from the view of payer of the rent.

But for the receiver of rent, To pay service tax - it may be required.

Payer can include service tax paid on rent also in rent so as to compute Sec.10(13)-HRA.

I hope this could be the possible answer for your query.

There are no procedural restrictions in INCOME TAX ACT on this topic.

CA Mani

CA Mani (Expert)
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14 August 2007 I think - Restriction on calculation - As given by ahuja sir means that limits mentioned In 10(13).

CA Prasanna Krishnan V

CA Prasanna Krishnan V (Expert)
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15 August 2007 Dear Sir

Service tax could only be on rent for commercial buildings only.

Sec 10 (13A) of the Income tax act 1961 deals with rent on residential buildings only.

How comes the question of service tax on rent for residential building?