29 August 2020
I request all experts to advise based on facts below: 1) Nature of work: supply and installation of awning, wallpapers, wooden flooring, roller blinds, carpets, film etc. 2) Rate: combined rate of work for material as well as labour charges 3) Advance is received from customers Queries: 1) Does it become a works contract for the purpose of GST? 2) If it is a works contract, is advance received from customer is liable to GST [if invoice is raised in subsequent month(s)]? 3) If it is a works contract, what would be rate of GST? 4) If it is not works contract, is advance received from customers is liable to GST 5) If it is not works contract, what would be rate of GST? Looking forward for your valuable advise!
29 August 2020
A1. Yes Works Contract A2. GST on Advance also A3. 18% A4. As of now advance against supply of goods is not liable to GST but advance against service is liable to GST. A5. In case of supply of Goods relevant rate as per schedule of GST rates is applicable.
29 August 2020
Such supplies are nothing but a Works Contract, it cannot be seen in isolation as you have been contracted to deliver a set of services. Hence no question of separate individual GST rates for goods and services will have to be determined. Additionally, any advance against such services will also be liable to GST against a receipt voucher and you may have to discharge the GST Liability against it @18%. However, such advance/receipt voucher gets adjusted against the final invoice, there are provisions given in GST returns to handle such cases.
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