TMI BlogWhether rental income is attract service tax,X X X X Extracts X X X X X X X X Extracts X X X X ..... Dear Sirs, We are the group of companies having two plants in nearby distance with different registration, due to shortage of space one factory has given some ware space to another by preparing lease agreement on token amount as rent, this amount has been reflected in balance sheet as rental income, which is less than 2 lacs yearly, Please advice whether the leassor factory is liable to pay serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice tax ? if yes then Leasee can take credit of this service tax ?. Request to suggest your expert advice on this issue please. Thank you, Mitesh - Reply By Rajagopalan Ranganathan - The Reply = Sir, Since your annual rental income is less than 10 lakhs you need not pay any service tax as provided by Notification No. 33/2012-ST dated 20.6.2012. - Reply By KASTURI SETHI - The Reply = S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h.Mitesh Gandhi Ji, I support the views of Sh.Rajagopalan Ranganathan, Sir. It is also relevant to read the following clauses of Notification No.33/12-ST as amended. (vii) where a taxable service provider provides one or more taxable services from one or more premises, the exemption under this notification shall apply to the aggregate value of all such taxable services and from all such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... premises and not separately for each premises or each services; and (viii) the aggregate value of taxable services rendered by a provider of taxable service from one or more premises, does not exceed ten lakh rupees in the preceding financial year. 3. For the purposes of determining aggregate value not exceeding ten lakh rupees, to avail exemption under this notification, in relation t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o taxable service provided by a goods transport agency, the payment received towards the gross amount charged by such goods transport agency under section 67 of the said Finance Act for which the person liable for paying service tax is as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules, 1994 , shall not be taken into account. - Reply B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Aitha RajyaLakshmi - The Reply = Rental Income is subject to Service tax under the classification of Renting of Immovable Property. If the renting is for Residential Purpose it would fall under Negative list. Since it is for Commercial purpose, Service tax has to be levied. - Reply By Mitesh Gandhi - The Reply = Dear Sirs, thanks for your reply, I would like to inform you that last year the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re was service tax more than 10 lacs, i.e FY 2014-15, and we had paid ST on Job work last year, and this rental income generated in FY 2015-16 we also have job work worth 2 lacs both to gather below 5 lacs, what would be the guidlines in this situation, Dept asking to pay ST. thanks Mitesh - Reply By KASTURI SETHI - The Reply = If turnover during the preceding year is more than 10 lakhs, you a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re not eligible for. Threshold Exemption Limit next year. - Reply By Ganeshan Kalyani - The Reply = I too agree with the views of Sri Rajagopalan Sir, Sri Kasturi Sir. Further, balance sheet is prepared on all PAN India basis, so income disclosed on the credit side of the Profit and loss account is assumed as the income of all locations from wherever services would have been provided. If that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is below the threshold limit then service tax is not applicable. - Reply By YAGAY AND SUN - The Reply = Threshold exemption limit is not based on Balance Sheet as there is no such provision in the Finance Act, 1994 . This provision has been enshrined only in GST Laws. - Reply By Ganeshan Kalyani - The Reply = But balance sheet is a record compiled for PAN India. It shows that how much reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue is earned during the year. The service tax audit team also asks for balance sheet for their desk review. Even trail balance is called by the auditor to identify the revenue heads. They most of the time levy tax based on balance sheet and trail balance. I have experienced it in practical. Hence my reply. - Reply By YAGAY AND SUN - The Reply = We do stick to our reply. - Whether rental income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is attract service tax, - Query Started By: - Mitesh Gandhi Dated:- 17-2-2017 Service Tax - Got 9 Replies - Service Tax - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
