TDS on Service Tax

I think there is a circular for this in my view this tds is without service tax.please wait for others to give their views on the same

it will only be deducted on rent and not service tax

net amount of rent.....................

Plz..can anyone make it clear by an example....

example...?

Rent paid-1,00,000. (per month)

service tax to be charged @ 10.3% -Rs. 10,300

Tds to be deducted.... @ 10% if payee is individual or 20% for corporate assesse on 1,00,000(rent) and not 1,10,300(rent+service tax)

kkkk...but as in your example rent < rs.120000..

So,accordingly should it be considered for TDS...???
 

Neha Jain

what we discussed is rent above 10 lacs p.a for which service tax is applicable on that whether tds is inclusive of service tax or excluding the same.In such cases the answer is TDS without service tax.If the rent does  not cross the threshold limit of Rs 1,20,000 p.a you need not deduct tax

my example is for one month of rent.

ya if rent per anum is less than 1,20,000  it need not be considered for tds

hope u r clear now???!!!

Thanxs...

In case of rent u/s 194-I, tds is to be calculated on rent exclusive of service tax.

As per CIRCULAR NO. 4/2008, DATED 28-4-2008 og IT Act, it has been clarified by CBDT that "Service tax paid by the tenant doesnt partake the nature of income of the landlord. The landlord only acts as a collecting agency for Government for collection of service tax. Therefore it has been decided that tax deduction at source (TDS) under sections 194-I of Income-tax Act would be required to be made on the amount of rent paid/payable without including the service tax. "

So TDS s to be deucted only on the pure amount of rent excluding service tax.

what in case of Service Tax on Professional Fees?

e.g. Professional Fees is Rs.50,000/- P.M.

& service Tax is Rs.5,150 (Including EC & HEC)

On What amount TDS should be deducted?

whatever it may be dear suhas.

TDS need not be deducted on service tax as it doesn form part of income of the service provider.

so tds is only on 50,000.