Abatement on s.tax
This query is : Resolved
07 May 2012
In a work contract, If the work contract value is Rs. 100 and Vat is 4 %. Tell me how we calculate abatement and whether the Vat rate should also be abated
CA Nikhil Jhanwar
(Expert)
07 May 2012
In Works Contract you have two options
(i) Either deduct the value of goods involved in the execution of works contract and pay service at normal rate of 12% on service portion only
(ii) Or pay service tax at the rate of 4.8 % under Composition Scheme on whole value of Rs. 100 (assuming that Rs. 100 is the whole contract value)
As regards, VAT in both the case VAT amount shall not included in value of taxable service
(i) Either deduct the value of goods involved in the execution of works contract and pay service at normal rate of 12% on service portion only
(ii) Or pay service tax at the rate of 4.8 % under Composition Scheme on whole value of Rs. 100 (assuming that Rs. 100 is the whole contract value)
As regards, VAT in both the case VAT amount shall not included in value of taxable service
08 May 2012
But I am talking about the abatement i.e you get 67% abatement on Work contracts.
My query is related to deduction of abatement
My query is related to deduction of abatement
08 May 2012
Total value (Material + Service) 100
Less: Abatement 67% (as mentioned by you)
Amount on which Vat to be levied 33
Above applicable if no proper records are maintained to bifurcate the material & service component of the bill.
Less: Abatement 67% (as mentioned by you)
Amount on which Vat to be levied 33
Above applicable if no proper records are maintained to bifurcate the material & service component of the bill.
08 May 2012
Total value (Material + Service) 100
Less: Abatement 67% (as mentioned by you)
Amount on which Vat to be levied 33
Above applicable if no proper records are maintained to bifurcate the material & service component of the bill.
Less: Abatement 67% (as mentioned by you)
Amount on which Vat to be levied 33
Above applicable if no proper records are maintained to bifurcate the material & service component of the bill.
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