Works contract
This query is : Resolved
11 September 2011
1. we are providing service of laying of
LAN,WAN , NETWORKING.
2. we get the contract from the companies
for laying of the network and for sale
of items.( i.e divisible contract).
Normally the contract take 2 to 3 month
to complete.
3 my question is what kind of registration
we required in Delhi vat . should we go
for simple registration or should we go
for works contract registration.
4. and also how should we account for
income from these work contract. the
bill for laying of lan and for sale of
material is issued after completion of
contact
LAN,WAN , NETWORKING.
2. we get the contract from the companies
for laying of the network and for sale
of items.( i.e divisible contract).
Normally the contract take 2 to 3 month
to complete.
3 my question is what kind of registration
we required in Delhi vat . should we go
for simple registration or should we go
for works contract registration.
4. and also how should we account for
income from these work contract. the
bill for laying of lan and for sale of
material is issued after completion of
contact
12 September 2011
Mr Sandeep,
This comes under normal VAT registration,because you are engaged in sale and works contract also.If your contract is fully divisible,i.e.you raise bills for labour charges and sale of materials separately the matter becomes very easy.You can claim exemption on all labour charges and declare the sales only.
If you are doing a composite contract,i.e.
quoting rates on the finished work,then you have to account the labour expenses and works expenses properly and claim exemption on them. The balance amount will be taxable.
MJK
This comes under normal VAT registration,because you are engaged in sale and works contract also.If your contract is fully divisible,i.e.you raise bills for labour charges and sale of materials separately the matter becomes very easy.You can claim exemption on all labour charges and declare the sales only.
If you are doing a composite contract,i.e.
quoting rates on the finished work,then you have to account the labour expenses and works expenses properly and claim exemption on them. The balance amount will be taxable.
MJK
13 September 2011
I agree with the expert
17 September 2011
thanks a lot..
but one this is not clear sir,
1. how should we account for
income from these work contract. the
bill for laying of lan and for sale of
material is issued after completion of
contact. do we have to make provision for contract on percentage completion method in respect of project which are started before march 11 and which will be finalised in next financial year and bill will be raised in next financial year
thank in advance
but one this is not clear sir,
1. how should we account for
income from these work contract. the
bill for laying of lan and for sale of
material is issued after completion of
contact. do we have to make provision for contract on percentage completion method in respect of project which are started before march 11 and which will be finalised in next financial year and bill will be raised in next financial year
thank in advance
17 September 2011
Mr Sandeep,
You can raise bills for laying of lan and supply of materials seperately. For the incomplete works remaining at the end of the year suitable provision has to be made in the form of work-in-progress and in the next financial year bill may raised after completing the work.
MJK
You can raise bills for laying of lan and supply of materials seperately. For the incomplete works remaining at the end of the year suitable provision has to be made in the form of work-in-progress and in the next financial year bill may raised after completing the work.
MJK
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
- Refund Annexure-B
- House Property Reporting in ITR
- TDS Claim year
- Liable to deduct tds and 44ADA
- Nomination of Bank for refund in itr 2
- Section 56(2) of the Income tax Act 1961 , Gift to relative .
- Rent lease agreement
- Refund of 20%pre-deposit paid for stay application
- TDS Challan Code
- Is Interest applicable for payment made through credit ledger vide DRC03 for FY 2020-21 & 2021-22
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
- Annexure B utility for GST Refund
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
