NIKHIL (STUDENT) (45 Points)
15 February 2011Hi,
One of our client provides a work contract of decorating a house.He purchases the materials from suppliers, hires labour and undertakes a contract. he raises a consolidated bill for the entire contract wihout bifurcating material, labour .
can anyone please tell how is vat/service tax is calculated and at hat percentage. can we pay vat/service tax under composition scheme?
Pankaj Arora
(Learner)
(3134 Points)
Replied 15 February 2011
Under work contract u need not to charge vat. Only you have to charge service tax @ 4.12%
CMA M.S. Venkatesh Babu
(Cost Accountant)
(56 Points)
Replied 15 February 2011
The amendment will not apply if the contract is covered under works contract service i.e. where Vat/Sales tax is payable on the contract.
Madhukar N Hiregange
(Chartered Accountant)
(39034 Points)
Replied 15 February 2011
The VAT would be applicable as it is works contract. You may examine the options available under local VAT laws which could be on regular scheme or compostion.
The classification would be under the work contract - residential complex and therefore no liability as 12 units not there. no service tax.
CA Unnikrishnan Nair N
(Chartered Accountant)
(2083 Points)
Replied 15 February 2011
The activity is liable to VAT under works contract . For details of schemes like compositions pl. refer to local VAT law . There is no service tax for such works rpvided in relation to single house .
suvidhi kothari
(1)
(41 Points)
Replied 15 February 2011
how shall sec 194C be attracted to such transaction???
whether tds will be deducted on full amount including VAT/ ST???
Gopal Suthar
(Chartered Accountant)
(60 Points)
Replied 15 February 2011
Both VAT and Services tax applicable in such transaction. for composition scheme etc. refer the relevant state VAT Act and rules.....
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