08 September 2014
there is a work contract of original work of reverse charge mechanism. Party A (individual)raises bill as Rs. 35000 (which include material and labour) but not shown separately
Now party B make payment to Party A as bill amount 35000 vat 35000*60%*4%=840
Service tax 35000*40%*(12.36/112.36)*50% = 770
tds 35000* 1% =350 Amount paid to party B = 33040
My question is Whether tds is to be calculated on Rs 35000 or Rs 14000(35000*40% i.e. service portion)