vat rate under WCT Act
This query is : Resolved
05 May 2009
One of my client is registered under WCT Act. He is a contractor and using material purchased by himself and charging the same against the bill raised bi him to his client. At the time of billing he is charging VAT @ 12.5%(against both 4% and 12.5% purchase) Is it correct procedure. Also what rate of labour charges should be count on the bill raised by him to his clients.
06 May 2009
There are three methods for accounting for works contract:
1.Actual basis - VAT is to be charged on material and service tax on labour charges on actual consumption basis + appropriate apportionment of profit between the two.
2.On adhoc basis.
VAT - On 70% of contract amount
Service Tax- On 30% of contract amount
3.Composition Scheme
VAT-@5% of contract price.
Service tax @ 4.12 of contract price.
1.Actual basis - VAT is to be charged on material and service tax on labour charges on actual consumption basis + appropriate apportionment of profit between the two.
2.On adhoc basis.
VAT - On 70% of contract amount
Service Tax- On 30% of contract amount
3.Composition Scheme
VAT-@5% of contract price.
Service tax @ 4.12 of contract price.
06 May 2009
Shekar,
U have not mentioned the place of registration.
However, there is nothing like registration under WCT Act. The WCT forms part of VAT. Since your client is charging 12.50% then I suppose he is registered under VAT (not under COT).
At the time of billing, he has to separate the material cost and labour cost. and on the material cost, he can charge VAT. The labour part may be excluded from the VAT.
U have not mentioned the place of registration.
However, there is nothing like registration under WCT Act. The WCT forms part of VAT. Since your client is charging 12.50% then I suppose he is registered under VAT (not under COT).
At the time of billing, he has to separate the material cost and labour cost. and on the material cost, he can charge VAT. The labour part may be excluded from the VAT.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Reopen of assessment proceeding
- TDS on Consultancy- Non DTAA
- Depreciation of fixed assets- coop housing society in mumbai
- COMMERCIAL INVOICE FOR MATERIAL AND FREIGHT
- Gift Received from nonblood relative
- Management System (IMS)
- Foreign lottery ticket bought online from India: legality, tax and consequences
- Reprocessing of rectification order AY 2025-26
- FTS Taxable under 115A
- Tax Audit u/s 44AB for Transport Business A proprietorship is engaged in transportation business and
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- STATUTORY AUDIT OF A SMALL PRIVATE COMPANY INCORPORATED ON 28.03.2025
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
