1.If a Resident's Welfare Association colects less than Rs. 3000 from some of the residents as monthly maintenance fee, will this be exempted from service tax liability when it also collects more than Rs. 3000 per month from some other residents?
2. Is amount collected towards corpus fund also attact service tax?
if the gross collection exceeds 10L per year then ST applicable other wise not,
no slabs for inclusion or exclusion of ST
I hope you are aware of exemption notification No.8/2007 ST dated 01-03-2007 and in this context could you please re check this issue?
Also what is your opinion about corpus fund contibution?
Bye the way gross collection is more than Rs. 10 lakh per annum.
Thanks for your reply.
F.No.137/68/2007-CX.4
Government of India
Ministry of Finance
Department of Revenue
Tax Research Unit
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New Delhi, the 8th May, 2007.
Subject: Exemption to resident welfare association vide notification No.8/2007-Service Tax, dated 01.03.2007 – Regarding.
A number of representations have been received from Co-operative Group Housing Societies who are providing taxable services under section 65(105)(zzze) seeking whether a resident welfare association registered as a co-operative society with the Registrar of Co-operative Societies is entitled for the benefit of service tax exemption under notification No.8/2007-Service Tax, dated 01.03.2007 or not.
2. A resident welfare association, even if it is registered as a co-operative society with Registrar of Co-operative Societies, is eligible to avail exemption from levy of service tax vide notification No.8/2007-Service Tax, dated 01.03.2007 provided the following conditions are satisfied, namely:-
(1) The exemption is available for the services specified under section 65(105)(zzze) of the Finance Act, 1994 and provided or to be provided by the association to its members.
(2) The sole criterion for membership of the resident welfare association is the residential status of a person in a residential complex or locality i.e., membership of the association is restricted only to the residents of the complex or locality.
(3) The value of total consideration received from an individual member by the association for providing the services should not exceed Rs.3,000/- per month.
3. This issues with the approval of Member (Budget).
Yours faithfully,
(G.G. Pai)
Under Secretary to the Government of India
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in light of above, monthly contribution below 3000 can avail exemption, subject to registration as cited under the notification.
as corpus fund is to be used in maintanance in future, it should be taken as contribution at par.
Thank You.
There is a recent circular on Jan 10th 2014 referred in https://blog.apnacomplex.com/2014/01/22/jan-2014-circular-on-service-tax-on-dues-collected-from-members-in-apartment-associations/ that exempts contribtutions from members paying less than 5000/- per month. However, if any member is paying is more than Rs 5000/- per month their entire contribution is liable for service tax (not just the amount excess Rs. 5000).
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