I am running ladies hostel. It is a Partnership firm. i want to know that the hostels are included in service tax. if yes, please give the details
Vikas
(CA)
(1135 Points)
Replied 14 December 2012
Any service is now taxable apart from those covered under Negative List (17 services) or under various exemption notifications.
I. There is a specific exemption provided for the hotel accomodation, wherein if the declared tariff is above Rs.1000/-, then the service tax shall be payable, vide Notification No.25/2012-ST dated 20 June 2012, the relevant extract of which is as follows -
"Services by way of renting of a hotel, inn, guest house, club, campsite or other commercial places meant for residential or lodging purposes, having declared tariff[1] of a unit of accommodation below rupees one thousand per day or equivalent;
[1] 2(n)“declared tariff” includes charges for all amenities provided in the unit of accommodation (given on rent for stay) like furniture, air-conditioner, refrigerators or any other amenities, but without excluding any discount offered on the published charges for such unit;"
II. Moreover, there is also am abatement provided of 40% on such renting vide Notification No.26/2012-ST dated 20 June 2012.
III. There is also an entry in negative list wherein , it is stated that
"Services by way of renting of residential dwelling for use as residence"
Hence, you may consider the above, and decide accordingly.
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