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Whether paint contracts are work contracts??

Naman maheshwari (Student CA Final ) (32 Points)

09 April 2014

Hi to all!

My company has given a contract to paint its premises to a agency and that gency is charging service tax at 12.36%. Can we treat as it as a work contract and avail the benefit of abetment???

Thanks,

Naman Maheshwari

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2 Replies

DINU SUKUMAR (Audit Manager) (176 Points)
Replied 11 April 2014

Hii Sir,

Contract including materials only is coming under the definition of works contract. Pure labour contract not amounts to works contract and not eligible for abatement at 60%. Regads.

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rajesh deshpande (FINANCE AND ACCOUNTS MNG) (43 Points)
Replied 12 April 2014

For this abatement, you have to take seperate quotation which will be charges under labour charges and other is for only material. Otherwise, you have to deduct TDS on full gross amount. Now TDS is attract only on net amount excluding service tax.......