Service tax and vat

This query is : Resolved

DHAVAL (Querist)
Follow

03 August 2012 Hello,

One of my party has provide goods o Rs.5,00,000/- to govt. sector. Amount include charges of labour also.
Party is liable for service tax and VAT.
if they make one invoice of Rs.5,00,000/- then how to calculate service tax and VAT

Please help..........

CA Guru M

CA Guru M (Expert)
Follow

03 August 2012 Hi Dhaval,

If you rising single invoice for both, then breakup for goods & labour charges should be separately shown.

So that VAT on goods & Service tax on labour charges can be readily calculate.

Out of Rs.5L you need bifurcate good value & labour charges.

If your rendering labour charges free of cost then service tax will not applicable.

Message likes : 1 times

DHAVAL

DHAVAL (Querist)
Follow

03 August 2012 suppose Party has given price of Rs.100/- per unit which include price of goods and labour charges.
separate charges are not given so is it necessary to mention labour the charges in bill ?

and is there any provision for 4.12% S.tax on total amount ?

Upgrade to CAclubindia Pro. Subscribe Now!

CA Guru M

CA Guru M (Expert)
Follow

03 August 2012 If your able to bifurcate consideration of Rs.100 into value of goods & amount for labour charges, then you can mention it on invoice.

Service tax @ 4.12% is applicable for Works contract.

In your case applicability of works contract can be determined only after knowing nature of labour charges.

Message likes : 1 times