Service tax on work contract
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
30 May 2015
Sir
mujhe yeh pata karna work contract,repair or maintenace pe kaise service tax calculate karte hai, isme 60 or 40 nikal ke jo aaye uska aadha karke kaise service tax charge karte hai sir iske bare me bataye mai isme confuess hun mujhe yeh 60/40 ka chakar samajh nahi aa raha
MOHAMMED HUSSAIN
(Expert)
31 May 2015
Dear Sir
For Works Contracts (New Works), the abatement is 60% and if the recipient is paying 50% (50% of 40%) tax at their end, you have to charge balance 20% in your invoice that means Rs.100/- invoice value & WCT Service Tax @ 20% i.e. 2.472% totalling to 102.472 @ 12.36% (This rate is 14%) from 01.06.2015 onwards. For MRS, you have to bill for 35% (50% of 70%) tax not 30%.
For Works Contracts (New Works), the abatement is 60% and if the recipient is paying 50% (50% of 40%) tax at their end, you have to charge balance 20% in your invoice that means Rs.100/- invoice value & WCT Service Tax @ 20% i.e. 2.472% totalling to 102.472 @ 12.36% (This rate is 14%) from 01.06.2015 onwards. For MRS, you have to bill for 35% (50% of 70%) tax not 30%.
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