07 July 2009
a civil contractor received mobilization advance at an interest of 12% against an equal amount of bank guarantee. Will service tax be payable on this at the time of receipt or as and when the RA's are raised and this advance is adjusted
08 July 2009
Hi The Service tax is payable on Advance amounts received if the final bill is liable for Service Tax. You can refer this link for detailed info: https://www.caclubindia.com/forum/messages/2008/8/13117_service_tax_on_advance_money_received.asp
However since its a construction contract, check if mobilization advance is only for Materials or for Labour also. Generally the advance is given for materials.
08 July 2009
Yes, service tax is payable on receipt basis. However, you have to analyze the transaction whether it is received for the purpose of providing service or not. Further, either you have opted composition scheme or regular scheme.
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