08 January 2014
As per Circular No.4/2008 dated 28.4.2008, it was clarified that TDS on rental payments would be required to be made only on the basic rental amount without including service tax. In other words, TDS should not be made on the service tax portion of the rent. However, this analogy is not applicable to TDS under other sections.
In short-- For 194I - Deduct TDS on amount excluding service tax. For other section - Deduct TDS on amount including service tax.
Logic: Logic is that TDS should be on income and service tax is not income. But then the same rule should be foolowed for all sections i.e., for all section TDS should be deducted on amount excluding service tax which is not the case. Strange but fact.
08 January 2014
I ALREADY REPLIED----TDS is like advance tax it should be on income and service tax is not part of income. Therefore TDS not deductible on service tax portion.
08 January 2014
Actually tds not applicable on service tax portion only for 194I but tds required to be deductable on other tds sections . . Kindly refer my below file where it is explaiined in detailed how it is . . https://www.caclubindia.com/share_files/tds-on-service-tax-on-all-payments-except-rent-56695.asp#.Us2JNvQW0cI . . You will get detailed solutions for your query,once you read above linked file your query also gets solved... . .
CAclubindia
