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Service tax on commission for sale of land

Jayadevan (Dir) (25 Points)

23 October 2014

I sold a plot through a broker. The broker will issue me a receipt for his commission in the letterhead of a company which he is part of. Am I supposed to withhold and pay service tax and only pay the rest of the commission to him?

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8 Replies

praveen (Chartered Accountant) (6971 Points)
Replied 23 October 2014

You need not withhold service tax. You can pay the full amount to him.

You may have to withold income tax(TDS) at 10%.

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Jayadevan (Dir) (25 Points)
Replied 23 October 2014

Originally posted by : praveen
	You need not withhold service tax. You can pay the full amount to him. You may have to withold income tax(TDS) at 10%.

Thank you for your reply. The receipt will be in the name of the company (not the individual). So I don't think there is a need to withhold income tax. Could you kindly provide some reference which says individuals need not deduct service tax when making payment to a company which provided services (receiver of service is an individual and provider is a company).

AJAY NAGPAL (accountant) (23 Points)
Replied 23 October 2014

U have to just deduct tds on commission amount @ 10%

Manoj Agarwal (Service Tax Consultant Rourkela ServiceTaxExpert@yahoo.com) (3456 Points)
Replied 23 October 2014

No need to deduct service tax while paying commission as above.

Pritesh (own) (35 Points)
Replied 23 October 2014

If amount exceeds rs. 10 lakhs The agent will have to collect service tax as it's his Duty to do so. Tds will have to be made depending on facts considering provisions of sec.194H if resident and sec.195 if non resident

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K. Biji (Govt: Employee) (64 Points)
Replied 24 October 2014

Sir, we engaged a partnership firm for conducting topographic survey of land. In addition to their fee we have to pay transportation charges as per terms for bringing their equipments to the site. In their bill, they have charged service tax on their fee and transportation charges. Kindly inform whether we are liable to pay service tax on such transportation charges.