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Service tax and income tax on renting of house property

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yashsr

2285 Points Joined April 2011

Hi,

Just wanted to confirm that if I rent out a flat/factory premises which is:

1) Immovable Property as per the head of service 'Renting of Immovable Property' as per Service Tax

2) House Property as per the head of income 'Income from House Property' as per Income Tax

Is the same property taxable at both the places? Or is there some kind of double taxation benefit with the Service Tax and Income Tax bracket?

Also, wanted to confirm that the TDS on such receipts has no bearing/relation to Service Tax, is this correct?

Replies (2)

CA Unnikrishnan Nair N

Chartered Accountant

2083 Points Joined February 2011

Renting of flat is not liable to service tax while renting of factory is taxable. There is no double taxation as incom tax is on profit on renting while service tax is on gross rent. Income tax is out of pocket of the landlord while service tax is a cost of the tenent. Service tax is cenvatable whereas income tax is not so.