Service tax on Rental income

[Guest]

Reg tax on Rental Income.My client is not receiving full amount of service tax on his rent. Some of the tenant are paying 50% of service tax and some are not paying the service tax.I hv told him that service tax is to be paid by you on the amount of Rent received by applying reverse calculation, but he wants that the department should have some remedy or relaxation to pay the amount which is received only, Pl adv

[Surender Gupta]

You have advised your cline correctly. Now it is upon him to accept your advice or not. If he has something to represent before the department, he may proceed and put his presentation. Department may or may not accept his view, but, in the meantime, he has to comply with the requirements of statute.

AI Summary

Service tax on rental income must be borne by the provider via reverse calculation when tenants fail to remit tax. Service tax on rental income is payable by the landlord even if tenants do not remit it; the landlord must compute and discharge tax on rent received by applying reverse calculation, and may make representations to the department seeking relief, but must comply with statutory obligations pending any departmental decision.