Levy of s.t. on work contract

brahma gupta (Querist)
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04 June 2013 Please solve my problem,
Is service tax levy on work contract.
how will Service tax calculate on it.

kunal

kunal (Expert)
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04 June 2013 yes service tax is leviable on works contracts..

service tax is to be calculated on gross amount charged.. either at 70%/60%/40%

brahma gupta (Querist)
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04 June 2013 Thanks you, Kunal Sir!

Will CCR credit be received on payment on service tax in regard of above case to service receiver.

Ganeshbabu K (Expert)
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06 June 2013 Reverse charge in works contract service:-

1)50% tax by service receiver if service provider of works contract service is individual, HUF, proprietary or partnership firm or AOP

2)AND service receiver is business entity incorporated as body corporate.

3)50% service tax is payable by service provider and 50% by service receiver. The service receiver liable for 50% even if service provider does not charge service tax.

4)Construction, Job work with material, AMC covered under works contract.

Ganeshbabu K (Expert)
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06 June 2013 Billing by service provider:-

1)Service provider should charge only his part of service tax

2)Service receiver to pay service tax of his part by GAR-7 challan

3)Service receiver liable for only his part and not entire amount, even if service provider does not charge his portion of service tax.

4)A statutory liability cannot be shifted by mutual agreement. If statutory liability is of service receiver, he alone is liable..

brahma gupta (Querist)
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06 June 2013 thanks u Sir, ganeshbabu!

Message likes : 1 times

brahma gupta (Querist)
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07 June 2013 Urgent,
can service receiver avail exemption u/NN 6/2005 in above matter

Ganeshbabu K (Expert)
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07 June 2013 The small service provider exemption of ` 10 lakhs not available when tax is payable under reverse charge.

brahma gupta (Querist)
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11 June 2013 thanks ganeshbabu !

Urgent,
when service tax will levi & pay on service amount that was received before service started & completed.

Ganeshbabu K (Expert)
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13 June 2013 Didnt get your question clearly

as a service receiver you have to pay service tax on payment to service provider..

if bill is not settled for 6 months pot is date of invoice and u need to discharge it with interest

Thanks & regards
Ganeshbabu k

brahma gupta (Querist)
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13 June 2013 Hi ganeshbabu!

Situation is that I have received money in advance for work contract which will be provided after some time.
question is that when will service tax be levied on that advance amount of work contract and when it will be paid.

thanks & regards
Brahma Gupta

Ganeshbabu K (Expert)
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14 June 2013 In reverse charge taxable event is payment made to service provider.

Thanks®ards
Ganeshbabu k

brahma gupta (Querist)
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14 June 2013 Thanks GANESH BABU!

Regards
BRAHMA GUPTA

brahma gupta (Querist)
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15 June 2013 hi friends!

it`s urgent

I am service receiver and i will have to pay service tax for works contract under reverse charges mechanism. Question is that can i utilize cenvat credit for payment of above service tax.

Ganeshbabu K (Expert)
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15 June 2013 No ,

1)Cenvat credit cannot be used to pay tax by service receiver. Service tax as to be paid by cash only i.e. GAR-7 challan.

2)Once paid, Cenvat credit can be taken if otherwise it is his eligible ‘input service’.

3)Tax should be paid under service tax registration number of service receiver and included in his return as he is liable to pay service tax.

Thanks ®ards
Ganesh babu k

Ganeshbabu K (Expert)
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15 June 2013 For your reference

1)Service tax is payable by service receiver when actual payment is made to service provider and not on receipt of Invoice from service provider. However, if payment is not made to service provider within 6 months, service tax is anyway payable. Interest is also payable.

2)Exception is that when service provider is outside India is Associated Enterprise (group company with at least 25% common interest), the service receiver is liable to pay service tax as soon as the account of service provider is credited in books of account of service receiver.

Thanks ®ards
Ganesh babu k

brahma gupta (Querist)
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15 June 2013 THANKS GANESHBABU!

regards

Brahma Gupta

brahma gupta (Querist)
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20 June 2013 Dear friends
Please suggest for the below case:
Case -I URGENT

Under Reverse Charge( work contract ),
Total service Portion of work contract
- Rs.886056
.Question is that Service receiver and service provider will be required to pay service tax on their portion under reverse charge.

THANKS & REGARDS
BRAHMA GUPTA

Ganeshbabu K (Expert)
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20 June 2013 Yes..it is

if reverse charge is applicable

50% of service provider
50% by service receiver

Thanks & regards
Ganesh babu k

brahma gupta (Querist)
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20 June 2013 Thanks Ganeshbabu!

But total Service amount of works contract
is below the ten lakh.

regards

Brahma Gupta

brahma gupta (Querist)
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20 June 2013 hi Ganeshbabu!

Would i chat with u by gmail.

my gmail id- brahmagupta84@gmail.com