Service tax on renting of commercial property

Snehal (Learning Tax) (129 Points)

09 March 2013  

 

One of my Client (Individual) has rented Commercial property :

Property 1: Receiving rent Rs. 60,000/- per month. i.e. 7,20,000/- per annum, as it was below the threshold limit of 10 Lakhs, Service Tax was not Levied.

Property 2: Now he bought another commercial property, which is being rented, the rent is expected to be Rs. 12 lacs per annum.

Q1. As the exemption limit will cross by 10 Lakhs, so Service tax will be applicable & he will have to do the ST Registration & levy Service tax @ revised rate of 12%. on this property, Is it correct?

Q2. What about the first property, will it be liable to Service Tax as well?

Looking forward for a positive response, Thanks.