TaxTMI 
TaxTMI 
Dear Sir,
whether Conversion premium received on converting lease hold properties into free hold property is liable for Service Tax??
Thanks
SERVICE TAX ON CONVERSION PREMIUM
16 Dec 2015 
7 Replies 
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Conversion premium not a taxable service, so conversion charges excluded from service tax liability under statutory exclusion.
Conversion premium for converting leasehold to freehold is not a taxable service and is excluded from service tax liability; one commissionerate reportedly sanctioned a refund for conversion charges. Payments of royalties for use of a foreign brand are taxable as Intellectual Property Services under the Reverse Charge Mechanism, with full liability on the service recipient in the taxable territory. (AI Summary)
Conversion premium for converting leasehold to freehold is not a taxable service and is excluded from service tax liability; one commissionerate reportedly sanctioned a refund for conversion charges. Payments of royalties for use of a foreign brand are taxable as Intellectual Property Services under the Reverse Charge Mechanism, with full liability on the service recipient in the taxable territory. (AI Summary)