Service tax - applicable to online ticket website

Please note the following -

Let’s say, ticket value is Rs.100/- and your commission is Rs.10/-. You receive Rs.100/- from the customers and transfer Rs.90/- to the Event Managers.

1) Is Event organiser liable to pay service tax on ticket value ?

- The Event Manager should be required to pay Service tax on Rs.100/- instead of Rs.90/-. However, it is required to note that under whose name and at what value the invoice/ bill or receipt is issued.

2) Am i liable to pay service tax on ticket value as i am selling ticket on my website ?

- No, you are not the main service provider. Instead, you are merely acting as an Intermediary.

3) Am i liable to pay service tax only on commission charged by me for my services to event organiser ?

- Yes.

4) While selling ticket on my website if event organisers turnover is below Rs. 10 lac and he is not registered under service tax. In that case am i liable to pay service tax on full value of ticket

- No. You would still be liable to pay on Rs.10/-, i.e., your commission.

5) Any notification or case law to explain this situation in details

- Sec.67 explains that the gross amount charged should be the taxable value for your services provided. The main service provider is the Event Manager, hence, he shall be liable to pay the taxes on the gross amount charged i.e., Rs.100/-. There is a concept of Pure Agent under Rule 5 of the Service Tax (Determination of Value) Rules, 2006. In general, if you are clearly disclosing the name of the service provider and do not temper the nature of service or the amount charged by your principal i.e., event manager then in that case, you are the pure agent. However, a thorough and detailed approach is necessary for maintaining the documents and drafting of a mutual agreement.

6) I wish to avoid any future litigations or demands from department hence opting for opinion

- You may obtain any legal opinion from a renowned on this matter.

7) If my present turnover is below service tax limit and after 6 months if it crosses service tax registration limit then do i need to register under service tax, and do i need to pay service tax on sale made in first 6 months ?

- No. It would only arise afterwards.

Sir What about GST rate on sale of online tickets???