Tds and service tax
MOHAMED FIROZ
(Querist) 17 August 2014
This query is : Resolved
A three floor commercial property having eight shops is owned by me, my wife and my major son altogether for the past ten years, and the Property Tax receipt, EB receipt are all in our names together.
We have let out two shops together to four different persons for rent. After rental revision this month these three tenants will pay us as follows: Rs.22000, Rs.16000, Rs.18000 and Rs.35000 totaling to Rs. 91000 per month. All of them were earlier paying below Rs.12000 only. As head of the family the rental receipt and the rental agreement has so far been executed in my name.
All three of us are IT assessees and the rental income is divided by three and declared in our statements and there has been no concealment.
After the revision of rent the new annual rent income will be Rs.1092000. I understand that service tax will be applicable for rental income exceeding Rs. 1000000 per year.
AS regards IT computation, after standard deduction for maintenance @ 30% and deduction of property tax, our rental income will work out to Rs. 7400000 per annum or Rs. 247000 per person for the accounting year 2014-2015.We have no other source of income at all.
As regards this property what is the applicability of TDS, Service tax and Income tax? I am going to enter into new rental agreement with these tenants soon. Am I right in executing agreements and receipts on behalf of my family in my name? Please correct me if I am making mistakes and also advise me as to how to avoid these taxes.
Devajyoti Barman
(Expert) 17 August 2014
Commercial query.
Engage a professional, you can afford his fees.
Suhail A.Siddiqui
(Expert) 18 August 2014
U have very good case and required lot of consecrations before advise, keeping in view rent agreements,ownership documents, TDS certificate ETC. Please consult establish consultant to save service tax, which is 12.36%. 9810043819
