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Service Tax Credit on Paid Service Tax on Rent

Dear sir,

WE are manufacturers, our factory in chennai & Bhuj and HO In mumbai. Our Mumbai office on Rent. Can we claim service tax on rent?

If yes, Let us know what is the procedure for the same.

Subhash from India

Subhash, you can not get service tax credit on the paid tax on the rent. There are following reasons of this .

1. Service tax credit is only claimed if you are generating output service with in put service. For example, I am providing tuition on rented office. At that time, I can get the service tax credit on the rent .

2. I am also paying internet bill. With internet bill , I also pay service tax. I am businessman, I can just show the total amount as my business expense. With this, I will pay less income tax. So, it will just benefit for income tax but there will not any option for service tax credit. Like my case , your case tells same story.


  1. yes you can take credit of service tax.

    however as mentioned in previous reply, there is no way you can use it for yourself.

    there is one provision in service tax – Input Service Distributors, which alow head office or sales offices to transfer the input tax to output tax locations.

  2. kamalkishor R.PaldiwalFebruary 20, 2013 at 3:54 AM

    Service tax paid for rented head office canbe availed by head office of the manufacturer and can be distributed to manufacturing units proportionately under service tax registration for the service tax catagory "input service distributer" .The manufacturing units can utilise this Service Tax credit for payment of Central Exise duty.


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