Service tax applicability on debit notes

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... In X Group of companies, there are three companies. In one co.A of the said group, there is one employee who is IT/EDP Manager. This employee look after the IT needs of all three companies. His salary cost is shared by other two companies also in a pre agreed ratio.They have a MOU for this purpose and also for sharing other common costs like travel, conveyance etc. Is service tax applicable on Deb .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... it notes raised by Co. A on other two companies for such sharing ? Is TDS also applicable on this ?? - Reply By Madhukar N Hiregange - The Reply = In normal course when only the costs are being shared there is no service between the companies. It maybe ensured as a measure of abundant caution that the rule 5(2) conditions are also met. - Reply By V Ramanujam - The Reply = I am of the view that t .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... he cost of sharing employee s salary with costs like his travel, conveyance etc between the separate entitles in the group is liable for tax deduction u/s 194J of the Income tax Act and company sharing the cost is obliged to deduct TDS on payments made against debit notes. In addition, based on Service tax Valuation rules, I feel that the activity would also attract Service tax and the company .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... raising the debit notes is required to charge/pay service tax on the sharing amount/reimbursements. - Service tax applicability on debit notes - Query Started By: - Manoj Aggarwal Dated:- 15-2-2008 Service Tax - Got 2 Replies - Service Tax - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagement .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... india.com - TMI - TaxTMI - TMITax .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X