How much tax will be on software product

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

17 July 2011 We are a delhi based firm and are making one software product for a company is Bihar.

So can any one help m how much tax will be imposed on this product.

Thanks,

U S Sharma

U S Sharma (Expert)
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17 July 2011 Service tax ......... 10.3%
CST...................4% ( 5% now)

Querist : Anonymous

Querist : Anonymous (Querist)

17 July 2011 You mean both will be imposed. if we think logically and even technically. One item can either be a product or service and the most it can be that some of the portion of a item can be product and some portion can be service. But paying both the taxes will be double taxation.

Please clarify which will be imposed on it. As a revenue officer service tax person will say it will attract services tax and Vat officer will say it will attract VAT. But its we that have to decide where our item will fall and cannot given both taxes.

i hope you will agree with me.

B

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U S Sharma

U S Sharma (Expert)
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17 July 2011 No

if you pay excise on software, then no service tax, but in absence of excise, service tax is leviable

software development is service under central taxes, where the vat rules tax it as ..sales of tangible goods, i.e right to use.....

Querist : Anonymous

Querist : Anonymous (Querist)

18 July 2011 Thanks for your valuable information Can you please help in finding that how much excise will be paid on Software.