I have a travel website where I offer rooms from various hotels to the visitors. I am collecting advance amount from the clients. I keep my service charge and the balance i will transfer to the respective hotel.
Do I want to pay tax on the collected amount or only to the amount of my service charge.
I am getting some foreing clients also. I use the Pay Pal account.
With best regards,
john
Payment made to the hotels by you on your clients' behalf is not your income, hence no income tax or service tax. The amount you charge for your services attracts service tax. The income you earn on service provided will be taxed under income from business & profession.
your service charge means commission on booking, so the gross commission should be taken as business receipt, gross commission is liable for service tax above 10L
you have to calculate profit from such commission income and add that income to your taxable head under profit and gains of business and profession.
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