Question on tax exemption

Refer Individual Tax Slab Rate for Respected Financial Year

Ok sir, but i need to know if the income from training & coaching is exampted from tax. how  can we get tax examption ?

it is not exempted from tax...both service tax and income tax is applicable...

 

Agree with Ubaid

Originally posted by : Ubaid
	it is not exempted from tax...both service tax and income tax is applicable...

 

as it will be the first year of the centre(if the training & coaching opened in this year), you need not to be registered under the service tax. A person need to be registered under service tax only if the taxable services during the previous year are more than 10,00,000. If the current year itself is the first year of the business, the taxable service provided during the previous year are assumed to be Zero(0). So there will not be any liability to collect & pay service tax to the department untill your taxable services provided during the previous year are more than Rs. 10 lakhs . However there is no exemption from payment of income tax

agree with harish....u can avail SSP (small scale service provider) exemption of 10 lacs.....

@ harish i had read somewhere sometime ago that u have to register when ur turnover reaches 9 lacs...is that correct ?

If he operates on proprietary basis, then taxable as per slab rates else flate rate of 30% + surcharge and cess. It's private coaching and offering any recognised degree. So, fall within the definition of service tax only in collections exceeds 10lakhs. On reaching 9lakhs register for service tax.

If he operates on proprietary basis, then taxable as per slab rates else flate rate of 30% + surcharge and cess. It's private coaching and offering any recognised degree. So, fall within the definition of service tax only in collections exceeds 10lakhs. On reaching 9lakhs register for service tax.

@ Ubaid  yes, you are right(Thanks for the correction ) . A Service provider is required to be apply for service tax registration with in 30days from the date his turnover exceeds 9 lakhs. In the FIRST year of the registration the service provider will also get a flat deduction of Rs.10,00,000 while arriving at the total taxable services. But in the succeeding years there woudn't be any exemption, the SP has to pay even though the taxable services are less than 10 lakhs

Totally agreed with Mr. Harish Sama...Further, I would like to mention that though there is no specific exemption of income tax for training & coaching services but you always have an option to claim deduction u/s-80C for life insurance premium, PPF contribution, investments in notified units of mutual funds or UTI, 5 Years tax savings FD, contribution in ULIP of LIC or UTI, etc, 80CCC for pension fund of LIC, 80CCD for contribution to notified pension scheme [total deduction u/s-80C, 80CCC & 80CCD(1) limited to Rs. 1.50 lakhs u/s-80CCE], 80D for mediclaim insurance, 80G for any donations if paid, 80E for interest on education loan, etc...There is also a rebate u/s-87A upto maximum of Rs.2000/- in case your son's total taxable income doesn't exceeds 5 lakhs. Besides,the slab rate applicable to your son for A.Y. 2016-17 (i.e., P.Y. 2015-16) will be as follows:

Upto Rs.2.50 lakhs  - Nil tax

Over 2.50 lakhs to 5 lakhs - 10% of amount by which the taxable income exceeds Rs. 2,50,000/-.

Over 5 lakhs to 10 lakhs - 25,000 + 20% of the amount by which the taxable income exceeds Rs. 5,00,000/-

Over 10 lakhs - 1,25,000 + 30% of the amount by which the taxable income exceeds Rs. 10,00,000/-

 

Hope ur doubt is cleared now Sir...

Mr.stranger i want to remind you that the deduction under 80c is available only to an individual or huf.80c benefit is not available to a firm

However if the training centre is opened solely by that person as a sole proprietorship, he would be eligible for deduction

@ harish sama: The querist didn't mention about any partnership form..he simply asked about income from coaching & training centre to be run by his son..hence I replied accordingly..Moreover, there is no difference between a sole proprietorship firm & individual as per income tax law, which you later recollected...anyways if it's a partnership firm which the querist if may forget to mention then offcourse not only 80C but all sections which i have mentioned except 80G will not be allowed...

I would like to bring to your notice Entry 8 of Mega Exemption Notification 25/2012 dt 20-06-2012 amended, which provides exemption from Service tax on training and recreational activities relating to arts, culture or sports. The exemption is available to coaching or training relating to arts, culture or sports. Please check if your service falls in this category. .. If not, you still have SSP exemption upto first 10 lakh rupees of taxable turnover if you fulfil other conditions as specified in Notification No. 33/2012 dt 20-06-2012. As regards Income tax, slab rates applicable to individuals shall apply if it's proprietorship.