Input service distribution

[Asked by Guest]

Dear Tax Experts ,

Please provide your valuable opinion..

We are having our city office at Chennai wherein Marketing/Purchase/Commercial Finance functions being carried out for our two Factory ,duty paid godown and Export warehouse at Sholinghur
We are paying Rent to city office building and distribute the service tax to our Factories under Input service distributor. We have registered under ISD.
Please confirm whether it is correct and we are eligible for service tax credit.
Regards
K Srinivasan

AI Summary

Input service credit distribution: head office rent is creditable but must be allocated pro rata by turnover.
Input service tax on head office services such as rent is eligible for credit and may be distributed by an Input Service Distributor to manufacturing and output service units. Credit attributable to a specific unit must go only to that unit; credit attributable to more than one unit but not all must be distributed only among those units pro rata by turnover for the relevant period; credit attributable to all units must be distributed pro rata to all operational units by turnover. Outsourced manufacturing units may receive distributed credit but must maintain separate accounts and use it only for duty on goods made for the ISD, with transitional limits on older credit.