Service tax
This query is : Resolved
02 August 2012
in works contract i am charging servic tax 4.944 now as per new rule wef 1 july 2012 50% has to paid by both service reciever & service provider how to calculate eg if bill amt is of 50,000/- service tax charged on it is 4.944 that is service tax 2472 will paid by both party that is 1236 is this correct please explain in details
02 August 2012
For e.g the contract bill value is Rs.1,00,000.
The service provider is individual or firm. Let us see the liability of SP under reverse charge.
50% of 1,00,000 = Rs.50,000.00
Taxable t.o = 40% of Rs.50000 i.e = 20,000.00
Service tax 12.36% = Rs.2472/= (the answer may be same but dont calculate as 4.944%)
Now, service receiver is company. The service tax liability is equal i.e Rs.2472/= for company also.
Apart from service tax, the service receiver has to deduct IT TDS and VAT tds according to their state.
The service provider is individual or firm. Let us see the liability of SP under reverse charge.
50% of 1,00,000 = Rs.50,000.00
Taxable t.o = 40% of Rs.50000 i.e = 20,000.00
Service tax 12.36% = Rs.2472/= (the answer may be same but dont calculate as 4.944%)
Now, service receiver is company. The service tax liability is equal i.e Rs.2472/= for company also.
Apart from service tax, the service receiver has to deduct IT TDS and VAT tds according to their state.
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