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Service Tax On Rent

sunilmkv Started The Discussion:

Dear Sirs,

We are running a textile retail shop. Our building owner demanding service tax for the rent we pay (Rent is Rs:30,000 Per month).Is there any means to get rid of it . or we are really liable to pay that . Please help. Our Leese agreement is to pay monthly Rs:30000 per month only as rent besides that not mention anything about extra amount such as taxes or levies.

thanking you

Sunil Mohammed
098950 90038

sushm808 - Member Since: Apr 2010
Service tax on rental has come into existance from last about 3-4 years.

In my veiw, u can challenge him not to pay the service tax as he has not mentioned it in the agreement in writing. Also, u have to see whether he has become liable to pay service tax from this year ? (as service tax is to be paid by the receiver, if his receipts from rental income rs. 10 lac in a financial year. if he has become liable earlier and has not collected the service tax as extra amount then it will be favourable for u.
so, there are many points to be seen and is a matter of litigation and u have to consult a professional/Advocate.

In the nutshell, service tax has to be paid, in your case it may be borne by you or by your landlord.

In other cases, if the landlord has become liable, then the tax has to be paid to him unless provided in the agreement in writing.

While paying the Service tax, deduct the TDS on it (if your books of accounts get audited, a partnerhship firm/ company.


Quote:
Originally Posted by sunilmkv View Post
Dear Sirs,

We are running a textile retail shop. Our building owner demanding service tax for the rent we pay (Rent is Rs:30,000 Per month).Is there any means to get rid of it . or we are really liable to pay that. Please help. Our Leese agreement is to pay monthly Rs:30000 per month only as rent besides that not mention anything about extra amount such as taxes or levies.

thanking you

Sunil Mohammed
098950 90038

pradeepanckumaran - Member Since: Mar 2010
hi for rental the TDS applicable only the Rent amount. no need to incle Service tax for TDS deduction as per the notification regds pradeepan

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