Availability of exemption limit

[sunil jain]

If monthly rent of commercial property is Rs. 1,10,000/-wef july,07 but I do not get rent for for feb & mar,08. thereby total rent recd is Rs.7,70,000/-only till March,08 althogh bills raised upto march,08 would be for Rs.990000/ crossing 8 lac exemtion limit. Query 1) As total receipt is less than 8 lac for 07-08, I need not pay any service tax for 07-08. 2)and again for 08-09, would I be entitled for first 8 lac exemption as aggregate value of taxable service was below 8 lac in pr.year(because as per notification dt 1-3-05, aggaregate value means the sum total of first cosecutive payments received.) Is this view correct.

[Guest]

As per the notification, exemption is available till the aggregate value of payments received crosses Rs.8 lakhs provided no tax is charged on to the customer and no CENVAT credit is claimed. 1) you are not lable to pay tax for the fin.year 07-08. (2) you are not liable to pay tax for the FY 08-09 till the receipts during the year crosses Rs.8 lakhs.

AI Summary

Service Tax Exemption Confirmed for Commercial Rent Below Rs. 8 Lakh in 2007-08; Applies Again in 2008-09 A user inquires about service tax obligations for commercial property rent, which totaled Rs. 7,70,000 in the financial year 2007-08, despite invoices amounting to Rs. 9,90,000. They question if they are exempt from paying service tax since the actual receipts were below the Rs. 8 lakh exemption limit. The response confirms that no service tax is due for 2007-08, and the exemption applies again for 2008-09 until receipts exceed Rs. 8 lakhs, assuming no tax is charged to customers and no CENVAT credit is claimed.