cluping of service tax reg.

[krish supramanian]

Sir,

I am having a big multible complex, containing shops and a kalyana mandabam. I have rented the shops to different persions, and the mandabamhall and dining is Leased to another two persio for nominal rent..

All individuals are filing their own income tax and all are within the limit of service tax.

When calculating the service I am cluping all my rents for service amount. Is necessary to clup all other parties  service income to my  account,

Please clear the view.

[daya singh]

You are only liable for the rent collected by you and it is not required to club the service income of other individual for the payment of service tax

[NANDKUMAR SAGWEKAR]

You are service tax assessee , while calculating the taxable value of services ,you have to taken into account

 

value of taxable services charged by you.

[NEERAJ KUMAR, RANCHI]

You need to club all the rent being received by you directly only. If you have let out a premise and the tenant is providing some kind of taxable service from that premises you are liable for that service but the rent received by you from that person should for the value of total taxable service.

[Rakesh Chitkara]

Renting is a service. Tax is on service and not on service provider. If the property rented out is indivisible, having one "registry" regardless of the number of owners, any artificial splitting of rent may be legal from the Direct Taxation aspect. As per the indirect taxation concept, service tax will be paid towards the indivisible service, and thereafter multiple owners are free to divide in whatever manner is their share of property for income tax purposes. Implcation being, that service tax has to be paid on the entire amount BEFORE it is sub-divided.  There is no threshold exemption on the property being rented out, if the total combined rent is above Rs. 10 lakhs in a FY.

AI Summary

Renting is a service: account for service tax on rents you directly receive; indivisible supplies may be taxed before subdivision. An assessee is liable for service tax on the value of taxable services charged by him; rents and service income must be accounted for only to the extent they are received directly by the assessee. If the rented provision is an indivisible service, the entire value may be treated as taxable before internal subdivision among multiple owners. Attention should be paid to whether tenants provide taxable services from the premises and whether combined receipts exceed applicable exemption thresholds.