Taxes on interior design work

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We are registered manufacturer and output srvice provider and regularly  claim set off on VAT amount and credit on service tax  charged by service providers. Currently we have engaged an interior designer cum contractor for desig, supply and installation of office interiors at our new office premises. My quieries under

1. Can we claim set of on 12.5% VAT he would be charging on 67% of total contact value?

2. Can we claim credit on 10.3% service tax he would be charging on 335 of total contact value?

3. What percentage of the total amount of entire contact value we can deduct as TDS?

4. Is it OK if a vendor gives a single bill wherein he charges vat of 12.5% on basic contact value and service taxof 10.3% on 33% of  basic contact value?

 

 

Replies (6)

In this type of works contract, the classification wouldbe under commercial construction services. The options under ST are:

1. Pay 4.12% on gross value under composition. Credit of CED on capital goods + Service tax credit on eligible input services wouldbe available.

2. Pay ST on 33% and VAT as per local VAT law. No credit available.

3. Pay VAT on actual materials transferred and pat ST on balance: if VAT paid on 65% then pay ST on 35% under Not. 12/2003. Credit on Capital Goods / Services available.

Service tax credit is doubtful in the light of new definition of input service. Setting up of new office is not input service. If it is repair or maintenance, may be admissible. Credit under VAT is governed by the state VAT law. May not be admissble, as it neither input nor capital goods .

find more information about interior work at interior advisor and get free advice on designing or you can visit web site https://www.interioradvisor.in for online inquiry.

I am keeping this bookmarked as the responses on a complicated issue like works contract are given by service tax experts like Mr. Hiregange and Mr. Nair.

Regards,

Is there any provission regarding composit scheme of service tax on Interior Decoration

Hi,

we are engaged in telecommunications services, we have shiifted our registered office to some other place, where in we have taken interior decorator (renovation cost) services, In the invoice VAT & Service tax are charged, Can we take the same as input against our output

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