Service tax on immovable property

Queries 299 views 2 replies

Hi,

I have rented an industrial property to a compnay at Rs. 90,000 per month. I pay Rs. 4554 as a municipal property tax. The company is telling me to raise the invoice deducting the propotionate amount(4554/12= 379.5) of municipal property tax.

My question is how the invoice needs to be made. 

Do I have to deduct the propotionate amount from the 90000 and them add service tax to it which will result in ((90000-379.5)+14.5%), or the basic amount will be 90000 only and service tax will be imposed deducting the propotionate amount of Rs. 379.5 (90000+(14.5* 89620.5/100)).

Replies (2)

 

Rs. 90,000+(90,000-379.5)×14.5% is correct.

If municipal tax paid by co. Then

Rs. 90,000-379.5+(90,000-379.5)×14.5% is correct.

 

If the Municipal Tax is paid by the Company then U have to rasie the bill in this manner :

Gross Rent                                                                                             90000

Service Tax : 

Gross amount  of Taxable Service as per ST Law  90000+379.50

Less : Municipal Tax                                            379.50

Net Amount                                                        90000

Service Tax on 90000 @ 14.5%                                                                13050

Bill Amount                                                                                           103050


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