Rahul (CA PCC Student) (34 Points)
16 October 2015In odisha vat...
In newly parnership firm engaged in showroom of trucks & bus division
In partnership firm one of their partner has a land, on his land firm makes bulding for their said business. At the time of making building firm purchased TMT BAR & OTHER RAWMATERIAL for constructing building for the purpose of said business. Firm got TAX INVOICE FOR THE SAME... IN this situation can i take Input vat against Tax invoice if yes then how?.. if no then why?? With reason... Odisha vat act
dhanamganesh@gmail.com
(private service Accountant)
(80 Points)
Replied 20 October 2015
sir,
U cannot claim ITC exemption on Building materials if u are purchased even with tax invoice.
if u have bought with the purpose of resale or fixing along with the machinery etc then u can claim here u have tax invoice for the items of building construction purpose materials. so u cannot claim please.
with regards
P.R.Ganesh
Rahul
(CA PCC Student)
(34 Points)
Replied 27 October 2015
In addition to above question
because of newly partnership firm. firm made building for the purpose of business on one of the partner of the firm, for building firm incurred labour chares on labour supplier contractor. at the time of payment to labour supplier, PARTNERS could not deduct TDS, because of non availability of TAN. then how can i show in our books for mentioned Labour charges. can i book all of the amount in addition to BUILDING Cost
dhanamganesh@gmail.com
(private service Accountant)
(80 Points)
Replied 27 October 2015
sir ,
i understand that ur business is under building contractor business and making purchses thru vat tax bill, labour contract thru sub contractor thru his subcontractor bills with labour charges. in this case there are 2 things happening one is thru service tax applicable to labour contract and tds applicable for laabour payments. is common for all building construction business entities.
2 The treatment in vat for the same business are 2 ways. 1. your are a/c all your purchases and sales thru tax invoices and show tax for sale and and purchses. in this case u can claim itc provided that the materials applicable are used in the construction and tax is extracted (vat) from your billings.then u can calim itc. but normally the it is not possible monthly . since ur itc will be made qumilative till u complete construction and bill. ITC Rule says can claim only if there is a Vat payable. otherwise we cannot claim.so it is waste of time because mostly u will bill only by the end of completion of construction. so it is better to follow the next rule point no.2 . for ur conveniency reg. this pl. consult ur tax consutant
2. way normally most of the builders do the way of compounting tax 2% applicable directly for the construction business on the monthly purchases.. that is easiest way to follow. here only self assesment.and here no ITC Claim applicable .
3. REG Ur Service Tax Normally the builders calculate around 35% of Flat Cost as Cost of Undivided land and material cost , and another 65% will be treated as a cost of services and pay service tax 14% on the amount after adjusting applicable abatement in the Service tax act.
4.Even U dont have Tan u can deduct the same from the party . taken new Tan No. and when u are paying the amount to the Department U Pl mention Separately TDS amount and interest calculated at 18% separately in your payment challan. So u please account labour charges for full value 100% and Cr 1% tds since the contractor is individual and 2% incase of firm/company and credit the bal 98% to the Contractor A/c Please. when u make payment for 98% contractor a/c will be nullified please. if it not deducted previously u can even deduct on the total value till date billed from day 1 when u make next payment. and try to get TAN No. and Pay the dues as soon as possible and file qrly return then only we can generate and issue TDS Certificate generated in the software.
With Regards.
P.R.Ganesh
dhanamganesh@gmail.com
(private service Accountant)
(80 Points)
Replied 27 October 2015
sir ,
i understand that ur business is under building contractor business and making purchses thru vat tax bill, labour contract thru sub contractor thru his subcontractor bills with labour charges. in this case there are 2 things happening one is thru service tax applicable to labour contract and tds applicable for laabour payments. is common for all building construction business entities.
2 The treatment in vat for the same business are 2 ways. 1. your are a/c all your purchases and sales thru tax invoices and show tax for sale and and purchses. in this case u can claim itc provided that the materials applicable are used in the construction and tax is extracted (vat) from your billings.then u can calim itc. but normally the it is not possible monthly . since ur itc will be made qumilative till u complete construction and bill. ITC Rule says can claim only if there is a Vat payable. otherwise we cannot claim.so it is waste of time because mostly u will bill only by the end of completion of construction. so it is better to follow the next rule point no.2 . for ur conveniency reg. this pl. consult ur tax consutant
2. way normally most of the builders do the way of compounting tax 2% applicable directly for the construction business on the monthly purchases.. that is easiest way to follow. here only self assesment.and here no ITC Claim applicable .
3. REG Ur Service Tax Normally the builders calculate around 35% of Flat Cost as Cost of Undivided land and material cost , and another 65% will be treated as a cost of services and pay service tax 14% on the amount after adjusting applicable abatement in the Service tax act.
4.Even U dont have Tan u can deduct the same from the party . taken new Tan No. and when u are paying the amount to the Department U Pl mention Separately TDS amount and interest calculated at 18% separately in your payment challan. So u please account labour charges for full value 100% and Cr 1% tds since the contractor is individual and 2% incase of firm/company and credit the bal 98% to the Contractor A/c Please. when u make payment for 98% contractor a/c will be nullified please. if it not deducted previously u can even deduct on the total value till date billed from day 1 when u make next payment. and try to get TAN No. and Pay the dues as soon as possible and file qrly return then only we can generate and issue TDS Certificate generated in the software.
With Regards.
P.R.Ganesh
CAclubindia
