Vat on work contract

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2013 is WAT (work contrac tax) applicable on work contract?
If so what will be the rate?
Is this applicable on total work contract amount?
When the law comes into force?
If payment is delayed, what would be its penal interest?
How the remittances can be made to Sales Tax?

Please help us to have the information.

RENGARAJ R.K

RENGARAJ R.K (Expert)
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06 September 2013 Dear querist,

There is no tax called WAT. It is vat on works contract service.

The rate of vat and rules are based on the STATE VAT Act.

From your query, we are not able to see which state you are from. Always write, that you are from .... state, i am doing ..... works contract.

Because, rate of vat is different for civil works contract. Morever, VAT TDS is also applicable in many states.

Querist : Anonymous

Querist : Anonymous (Querist)

07 September 2013 Sir,

Sorry for the mistake, this is VAT.

We are in Kerala and are doing some interior work in our office with contractors from Kerala and Tamilnadu. We are usually deducting TDS from their payment and remiting in IT. But now we came to know that we need to deduct VAT from their payment. Please duide us the following.

1) What % we need to deduct?
2) When the law comes into force?
3) How can we make the payment to ST?
4) Is this applicable to total contract amount?
5) If we fail to deduct and remit the same in past years, what can we do now? what would be its penalty?

The work done was aluminium fabricatino + plywood work (cabinet and partition work) in offices.

Regards,

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