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Tds charged on service tax

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Querist : Anonymous

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Querist : Anonymous (Querist)
12 January 2013 Is tds charged on service tax in case of
1.We taken credit of service tax and
2.Without credit of service tax ?

12 January 2013 Except Rental Payments, Service Tax is taken into account for TDS purpose.

12 January 2013 The deduction of TDS is based on the provisions of income tax and it do not take the CENVAT into consideration for the same.

Under the income tax act, TDS is to be made on the gross amount of income (only the income portion and donot include any taxes charged on such income)in the case of Rent (u/s 194 I). However in all other cases, TDS should be made on gross amount paid / payable which includes service tax and other taxes.

Therefore, only for the purpose of deduction of TDS u/s 194 I no need to deduct tax on the service tax portion. CBDT had also issued a specific circular vide Circular No. 4/2008 on the above position.

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