Ambrish (SAP CONSULTANT) (29 Points)
29 September 2011Ref : circular F no. 275/73/2007IT(B) dated 30-06-2008 & circular no. 4 dated 28-04-2008
What is "any income by way of rent" for the purpose of TDS on Service Tax
Is it Rent Receivable Less:30% Less : applicable municiple Taxes
or
Gross Rent Receipts
& Is it Gross rent Payable or
Rent Payable Less:30% Less: applicable Municiple Taxes
Thanks & Regards
Ambrish
CA Unnikrishnan Nair N
(Chartered Accountant)
(2083 Points)
Replied 29 September 2011
TDS is on gross rent
DISHANT lodhi
(article assistente)
(198 Points)
Replied 29 September 2011
TDS shall be deducted frm gross amount
Ambrish
(SAP CONSULTANT)
(29 Points)
Replied 30 September 2011
That was a text book reply.. thats for that, but I had the query with reference to the two conflicting circulars issued by CBDT..
At one end, it exempt ST for calculating TDS (stating ST is not an Income at Receipients' end - as the basis of granting exemption for calculating TDS)
while in the second case, they been silent or rather DUMB, creating an issue for Judicial Scrutinee. So I asked any such explaination from the tax practicionears.
Boss everything is written in text book only and in practicle life also we have to refer them, we cannot write our own Act. This is also industry practice and followed by everyone. I am providing you the matter published in the website of ICAI (WIRC):
DEDUCTION OF TAX AT SOURCE ON SERVICE TAX – PRESS RELEASE {172 TAXMAN (ST.) 6}
Circular F. No 275/73/2007 – IT (B) Dated 30/06/2008 Clarified that the scope of the circular No. 4/2008 dated April 28, 2008 should not be extended to the payment made u/s 194J. CBDT earlier issued a clarification that, no TDS will be applicable on service tax portion while making payment of rent u/s. 194I of the Act. The board has now clarified that the payment made u/s 194I defer significantly from the payment made u/s. 194J in the way that in the case of 194 I ,TDS has to be deducted on any income paid as rent. However, in the case of section 194J TDS has to be deducted on any sum paid as professional and technical fees. The Board has decided to exclude TDS on Service Tax component on rental payment because it was construed that service tax payment cannot be regarded as income of the land lord. Since 194J covers any sum paid, the board has decided not to extend the scope of Circular No. 4/ 2008 dated 28 April 2008 to such payment u/s. 194J.
Those who wants to disagree on this should come with facts only and debate on the same.
CS Bijoy
(Expert)
(6394 Points)
Replied 30 September 2011
Wel explained by Ravi.......
Incase of Rent service tax is not included but in other case tds is tobe deduct on the amount including service tax.
CAclubindia
