Works contract
This query is : Resolved
11 September 2011
1. we are providing service of laying of
LAN,WAN , NETWORKING.
2. we get the contract from the companies
for laying of the network and for sale
of items.( i.e divisible contract).
Normally the contract take 2 to 3 month
to complete.
3 my question is what kind of registration
we required in Delhi vat . should we go
for simple registration or should we go
for works contract registration.
4. and also how should we account for
income from these work contract. the
bill for laying of lan and for sale of
material is issued after completion of
contact
LAN,WAN , NETWORKING.
2. we get the contract from the companies
for laying of the network and for sale
of items.( i.e divisible contract).
Normally the contract take 2 to 3 month
to complete.
3 my question is what kind of registration
we required in Delhi vat . should we go
for simple registration or should we go
for works contract registration.
4. and also how should we account for
income from these work contract. the
bill for laying of lan and for sale of
material is issued after completion of
contact
12 September 2011
Mr Sandeep,
This comes under normal VAT registration,because you are engaged in sale and works contract also.If your contract is fully divisible,i.e.you raise bills for labour charges and sale of materials separately the matter becomes very easy.You can claim exemption on all labour charges and declare the sales only.
If you are doing a composite contract,i.e.
quoting rates on the finished work,then you have to account the labour expenses and works expenses properly and claim exemption on them. The balance amount will be taxable.
MJK
This comes under normal VAT registration,because you are engaged in sale and works contract also.If your contract is fully divisible,i.e.you raise bills for labour charges and sale of materials separately the matter becomes very easy.You can claim exemption on all labour charges and declare the sales only.
If you are doing a composite contract,i.e.
quoting rates on the finished work,then you have to account the labour expenses and works expenses properly and claim exemption on them. The balance amount will be taxable.
MJK
13 September 2011
I agree with the expert
17 September 2011
thanks a lot..
but one this is not clear sir,
1. how should we account for
income from these work contract. the
bill for laying of lan and for sale of
material is issued after completion of
contact. do we have to make provision for contract on percentage completion method in respect of project which are started before march 11 and which will be finalised in next financial year and bill will be raised in next financial year
thank in advance
but one this is not clear sir,
1. how should we account for
income from these work contract. the
bill for laying of lan and for sale of
material is issued after completion of
contact. do we have to make provision for contract on percentage completion method in respect of project which are started before march 11 and which will be finalised in next financial year and bill will be raised in next financial year
thank in advance
17 September 2011
Mr Sandeep,
You can raise bills for laying of lan and supply of materials seperately. For the incomplete works remaining at the end of the year suitable provision has to be made in the form of work-in-progress and in the next financial year bill may raised after completing the work.
MJK
You can raise bills for laying of lan and supply of materials seperately. For the incomplete works remaining at the end of the year suitable provision has to be made in the form of work-in-progress and in the next financial year bill may raised after completing the work.
MJK
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- SEC 54 OF IT ACT
- Where to show the RCM on Rent paid to unregistered landlord
- Is Aadhar PAN linking required for opening bank account?
- Form 26QB for TDS on property
- CPC Processing IT Return for AY 2023-24 without recognizing the Taxation Option under New Regime
- DTCP approval
- TDS NUMBER SURRENDER
- Whether still royalty
- REGARDING GST ON COMMERICIAL PROPERTY
- RCM - commercial rent paid to URP under GST
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
- Regarding Resignation by Auditor from Pvt. Ltd.
- Regarding einvoice taken on nil rated sales
- Strategical investment in Public listed company
Trending Online Classes
-
Excel Mastery Program
CA Rishabh Pugalia
CAclubindia
