Servie tax on guest house

If you are charging rent from u r clients then u have to levy service tax at 60% of amount charged for accomodation. For other services like food & massage are naturally bundled in the ordinary course of business i.e. these services will merged into accomodation services. U dont need to levy any extra service tax on these services.

Please note if u avail abatement of 60% as i aforesaid then u can take credit of only input service tax paid and credit on input and capital goods will not be available.  

As far as vat is concerned u should refer ur state vat.

Thank you so mcuh for the replay. 

If i charge then only tax will be applicalbe on the other case if I am not then the complimenat service I provide will not attractservice tax. isit right.

Yes. generally service provider dont need to levy ST on complement or ancillary services becoz they charged fees for that services in their Main Bill. 

Therefore what is the rate of Service tax on Main service will automatically charged on these  complement or ancillary services by inclusion of amt of those  service in SP main bill.

Position before 1.7.2012 Definition and scope of service:   “Immovable property”, for the purpose of section 65(105)(zzzz), includes-  (i) building and part of a building, and the land appurtenant thereto;  (ii) land incidental to the use of such building or part of a building;  (iii) the common or shared areas and facilities relating thereto; and  (iv) in case of a building located in a complex or an industrial estate, all common areas and  facilities relating thereto, within such complex or estate, but does not include-  (a) vacant land solely used for agriculture, aquaculture, farming, forestry, animal  husbandry, mining purposes;  (b) vacant land, whether or not having facilities clearly incidental to the use of such vacant  land;  (c) land used for educational, sports, circus, entertainment and parking purposes; and  (d) building used solely for residential purposes and buildings used for the purposes of  accommodation, including hotels, hostels, boarding houses, holiday accommodation, tents,  camping facilities.  Explanation.- For the purpose of this sub-clause, an immovable property partly for use in  the course or furtherance of business or commerce and partly for residential or any other  purposes shall be deemed to be immovable property for use in the course or furtherance of  business or commerce.   (Section 65 (105) (zzzz) of Finance Act, 1994 as amended)  Position after 1.7.2012 Refer 25/2012 SL 18  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 of a unit of accommodation below rupees one thousand per day or equivalent.

Thanks

Venkat

 

Dear Gagan,

Very good conclusion. This is add to your answer.

Venkat

In addition to the above, since you have taken the guest house on hire, so you are the service receiver and if the service provider is charging service tax on rent of immovabe property, then you may claim cenvat credit on the same as you are using the same for providing output service.