Service tax in case of a works contract
This query is : Resolved
CA.Aparna Bhosale
(Querist)
03 October 2013
Whether Service tax will be charged on the Gross Amount including material and Labour incase of Works Contract?
CA Vijeta Verma
(Expert)
04 October 2013
If service portion can be determined from the computation
GAC-value of goods transfered-vat=Service portion ,then use this computation
Else,if service portion is not ascertainable
then
Gross amount charged for whole contact+FMV of goods supplied by service reciever excluding taxes-amount charged(if any) by the service reciever for supplying those goods
Balance amount will be "total amount charged".
Now out of this amount take service portion as 40%/60%/70% for original works contract,completion & finishing work contract,mainteance & repair contracts of movable goods respectively
GAC-value of goods transfered-vat=Service portion ,then use this computation
Else,if service portion is not ascertainable
then
Gross amount charged for whole contact+FMV of goods supplied by service reciever excluding taxes-amount charged(if any) by the service reciever for supplying those goods
Balance amount will be "total amount charged".
Now out of this amount take service portion as 40%/60%/70% for original works contract,completion & finishing work contract,mainteance & repair contracts of movable goods respectively
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