Franchisee on Service Tax

we are starting a franchisee in our education training for kids. and we are in the process can anyone tell how to go for handling the service tax . we may follow the follwing types,

1. Billing by the franchisee and they will pay the percentage to the principle.
2. if the principl giving the bills and how to make the service tax

Replies (4)
Dear Sendhil, Franchise is providing service of coaching and education training to Kids. Pls check that this service is covered commercial training & coaching centre. Then franchise is liable to pay service tax on this service. franchisor is also liable to pay service tax on franchise service. Pls circuler 59/8/2003 dated june 20, 2003. franchise service is taxable under section 65(105)(zze)
Service tax is payable on franchise service. However,you have to study service tax liability of education training to kids. Then how you propose to organise business etc. It is difficult to give general answer to your queries unless various aspects are studied
Educational Institutions/Hospitals like services were exempted from under Service Tax perview. Pls, review the status of Institution, if it is commercial coaching center, then you can liable to pay service tax. Its an educational institution there is no service tax. B.V.K.Nageswara Rao, Ph: 099891 57666, Email: nageswararao.bommakanti @ ril.com
Sir, Is there any specific provision relating to educational institutions which comes within the perview of service tax? is there any criteria for differenciating between education institution and commercial educational institutes?

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