New in Tax Matter need some advise

CA Shiv (Business Controller) (2987 Points)
Replied 09 July 2010

Hello,

Its considered as professional services...

1. After 10 lakhs of turnover ( receipts) you have to charge service tax..

2. The customer must have deducted TDS from tour payment last year.. so take tax certificate from them...

3. Get tax credit of such amount paid.....

2 Like

Nilesh (Web Designer) (27 Points)
Replied 09 July 2010

Hi Shivang thanks for your valuable reply,

i have almost 150 regular customers from them i am taking Nominal amount (aprox 2000/- from maintenance and website renewal cost) per year, and they gave me full amount, whatever i billed them, so i dont think they deducted TDS, is there any possibility? if yes than how can i know they deducted TDS or not,

CA. Abhishek K. Pandey (Manager (Advance)) (901 Points)
Replied 09 July 2010

Dear Nilesh,

Your service comes under "Fees for Professional & Technical Services/Royalty" and hence, TDs u/s 194J will apply. So, your TDS will be deducted only if your income exceeds Rs. 20,000.00 from a person.

I don't get one thing, you say you are providing these services to others, Ok? But then why you are paying for domain name and hosting fees? Do you own a website yourself?

1 Like

Nilesh (Web Designer) (27 Points)
Replied 09 July 2010

Dear Abhishek

thanks for your prompt reply, i understand that my customer can only deducated TDS if i take 20,000/- from them, please let me know this 20,000/- from one bill or total of financial year

Domain, Hosting and Website Development are three different things,

Website Development are purely professional services, in the development case whetever we charge customer are our profit, there are nothing to pay anyone expact 1. if we hire other professional and give them contreact money or salary 2. Office and infrastructure 3. Interenet bills and other related charrges

While

in Domain name regsitration Serices (i.e. caclubindia.com )

Doman name regsitration services handle by ICANN, so all the domain owner pay yearly charges to ICANN (not directly but via domain register like you take website services from us and we register domain on behalf of yours)

you can that we get domain name in Rs. 400/- per year we are taking Rs. 500/- from customer so Rs 100/- is our profit,

in Website Hsoting

Website hostng is a renting of web server from data center company, we are taking larges disk space on rent from such data company(Normaly from US based Company, and after particiang in the disk space as per requirement we provide individal client to host (to put online ) their website.

for example we get Servcer in 30,000/- per year and we host up to 100 website on that server, if we atke Rs 1000/- for every customer , total amount is 1,00,000/- while cost is 30,000/- therefore profit is 60,000/-

In that domain and hsoting case how to handle tax, please let me know

as per your question i own a website you can check it - shayona.biz

Thanks

Nilesh (Web Designer) (27 Points)
Replied 09 July 2010

Anyone?

CA Shiv (Business Controller) (2987 Points)
Replied 09 July 2010

Nilesh,

limit for TDS is for one single bill if it exceeds 20,000 or in total during the year if it exceeds 50,000.

Burden of TDS is on the payer... so if u having one single client for billing of more than 50,000 during year than he will deduct TDS on your bills.

kapil kumar agrawal (Chartered Accountant ) (169 Points)
Replied 12 July 2010

Dear u r not required to charge service tax on services provided by you.....

But when ur services exceeds Rs. 9 lacs u r required to register urself for service tax registration.....

Another thing i suggest that u should keep all the bills for which u made payments, whatever these payments related to..... it will help u in service tax input....

Now u r in exempt stream.... i wish ur profession will grow and u get register ur self for service tax registration....

Ankita (student) (21 Points)
Replied 29 October 2012

hey! you can go thru the net there are alot tutrols for this you can watch them and learn moreover you can take advices from professionals like https://www.moreclicks.in/ they provide services and traing for the same! Good Luck!