Works contract / Sublet

1198 views 5 replies

sachin parikh

125 Points Joined September 2017

Dear Sir
Please guide.

My client is receiving contracts for making roads from Govt. department so is falling under works contract GST.

Now he wants to sub let his work to his cousin and his cousin's turnover is below 75 lacs so could anyone tell whether his cousin can opt composition scheme under GST or he has to opt for regular GST scheme under works contract and fall under 18% GST?

Thanks and regards

Replies (5)

RAMESH KUMAR SINGLA

PROFESSIONAL

1777 Points Joined September 2017

Composition scheme under GST is an optional scheme. If the aggregate turnover is less than Rs. 75,00,000/-, the scheme can be opted. The nature of supply of services/goods by him cannot put any barrier on the right of the person to avail composition scheme. THerefore, he can opt for composition scheme and supply services as sub-contractor.

RAJA P M

"Do the Right Thing...!!!"

128147 Points Joined January 2015

Sorry to Say....

The Cousin Can't register under Composition scheme.

Bcoz, The nature of supply is Service oriented. So, No Way for Composition scheme. Only through Regular Scheme...

Kishor Agrawal

Accounts Consultant

71 Points Joined June 2017

Yes, I agreed with Raja Sir.
If turnover of subcontractor is less than 20.00 lacs than principal contractor needs to pay RCM on all payment made to subcontractor. or if turnover is more than 20.00 subcontractor needs to register under regular scheme.

sachin parikh

125 Points Joined September 2017

Resp.
Ramesh Sir, Raja Sir and Kishor Sir

Many thanks for your guidence.

I think Raja sir is correct. I just asked as I was in dilemma that what to give answer to my client as he has asked thus.

Thank you very much all of you for your valuable reply.