CA Mukesh Jain S (Chartered Accountant in Practice) (692 Points)
22 September 2011Franchise Service is leviable to Service Tax as per the Act. The Initial Payment (Non Refundable) made by the Franchisee to Franchisor to get the rights, Is it leviable to service tax ?
CA Unnikrishnan Nair N
(Chartered Accountant)
(2083 Points)
Replied 22 September 2011
Yes initial payments made to franchiser is liable to tax. But it is cenvat credit if franchisee is providing taxable services.
CA Mukesh Jain S
(Chartered Accountant in Practice)
(692 Points)
Replied 22 September 2011
But Franchisee is also paying an 1% royalty on turnover made. Then i felt the initial payment is not liable since he is making the payment to begin the Franchise agreement
CA Unnikrishnan Nair N
(Chartered Accountant)
(2083 Points)
Replied 23 September 2011
Initial payments except refundable deposits will form part of value of services.
rincy
(accounts & audit)
(25 Points)
Replied 20 July 2012
procedure of levy of service tax and tds deduction on franchisee turnover to franchisee by frnanchiser? in kerala
please help me and forward details of this .......... to my id rj.akkara @ gmail,com
also details of professional tax slab in kerala
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