Tds on rent to service apartments
This query is : Resolved
11 May 2012
Our Status is Partnershipfirm. We are doing Service Apparment Business. We are collecting Rent, food and other charges from different guests from one comapany. We are collecting service tax and luxury tax on the rent. Guest are not statying regularly.But the total business of the year from the same comapany is Rs.4,00,000/-. But the comapny deducted TDS @10% U/s 194-I. is it correct?... or is it u/s 194c @ 1% since we are giving service to the guest according to the contact with comany
CA SUMiT PATWARi
(Expert)
11 May 2012
In my opinion the type of agreement comes under the nature of contract.
Since the billing is not fixed per month (unlike rent), and is dependant on the guests accomodation days and actual food/service consumption, this takes the shape of a contract, to which section 194C applies.
However, if there is any fixed component (fixed rental @Rs25,000pm, irrespective of actual accomodation) then it should attract 194I.
Since the billing is not fixed per month (unlike rent), and is dependant on the guests accomodation days and actual food/service consumption, this takes the shape of a contract, to which section 194C applies.
However, if there is any fixed component (fixed rental @Rs25,000pm, irrespective of actual accomodation) then it should attract 194I.
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