Work contract related issue

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CA Prabhakar Dubey (Querist)

04 December 2007 Respected Members,

I wants to know about Work contract sale under within state sales without composite scheme. I am having some query regarding this as below;

1. What would be tax rate for seller or excutor or contractor of work contract.

2. Which form should the seller get from the principal for TDS & what rate applied by the principal.

3.Is seller can reduce the TDS from sales tax liability.

4.Is seller can get input tax credit on purchase of input supplied on work contract.

5.What steps must followed by the seller or contractor in this case.

6.How to represent the selling amount and TDS amount in Section G of Form 704.

Please reply it as soon as possible.

Regards,

Prabhakar

KAUSTUBH M JOSHI

KAUSTUBH M JOSHI (Expert)

06 December 2007 Dear Friend,
I would like to know in which state your client is. So that I can answer your questions.
In Maharashtra it is as follows:
1. The rate of Tax is dependent on date of work orders. The rate which prevails on the date of the said work order the tax is payable at such rate.
2. for this question please quote your state.
3.Yes
4. If said TDS is WCT TDS then its deductible
5. You shold specify what you expect in this question.
6. A reconciliation is to be given with how you have taxed relevant contracts etc is to be explained and is to be submitted along 704.

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