Is service tax liable to be paid by landlord on rent not realised ?Landlord is a charitable society.Immovable property let out for commercial purposes.Gross annual rent is about Rs.1 crore.Some tenants are not paying rent.
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Service tax on rent unrealised
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Dear George,
As per the rules of Point of taxation, the liability for payment of service tax arises as soon as the service is provided for a consideration. The receipt of consideration is not a factor for taxability of service.
In your case the assesse had provided the service (rent) for a consideration (rental income). Though the rent is not paid by the tenant, the landlord is supposed to pay service tax on the rental income.
P.S: Prior to 2012 the assesse is not required to pay service tax on unrealised rental income.
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