Franchisee

[Guest]

Sir/Madam,

Whether the payment made for taking franchisee of a restaurant service is a capital payment and can this be treated as an assest and amortisation can be taken thereon.

and Whether receipt made under franchisee agreement for giving the francisee is chargeable to service tax????

Please respond with both the prospect

AI Summary

Franchise Acquisition Payments: Capital Asset and Service Tax Exemption Explained for Income Below 10 Lakhs A franchisee inquired about the tax implications of payments related to a restaurant franchise. They asked if the payment for acquiring the franchise is considered a capital payment, eligible for treatment as an asset with amortization benefits, and whether income from granting a franchise is subject to service tax. The response clarified that income from granting a franchise is subject to service tax, with an exemption available if the income is below 10 lakhs per annum.