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Are Interior Decorators & Carpenters Liable for Service Tax?

(Guest)

Interior Decorators of (residential houses and commercials), and carpenters ie doing furniture work are liable to Service tax ?

If Yes, then what will be Service tax rate Liable to pay?

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12 Replies

satynarayan tiwar (Professional) (61 Points)
Replied 07 August 2008

It's depend on nature of works and billing systems

OFFICESELVA (Service) (515 Points)
Replied 07 August 2008

Interior Decorators - Sure

Carpenders - Whether indicidual/contractor etc., has to be decided.

Ruchika Gupta (Chartered Accountant) (247 Points)
Replied 07 August 2008

Interior decorators are liable for service tax! I don't think that carpenters are liable or not but im not 100% sure about them.

selvam.T (CA Practice) (49 Points)
Replied 12 August 2008

Interior decorator are liable to service Tax. if only labour work involved - 12.36%, if material also issued and material value not separately disclosed in the bill then - value of Bill X 33.33%X 12.36%. No Service tax for residential house.

CA V. Mohanakrishnan (Chartered Accountant) (401 Points)
Replied 26 September 2008

Interior decorators are liable to service tax @ 12.36% with service component alone being existant.

Carpenters in the current scenario predominantly work on work contract basis which also includes materials. If registered under the Works Contract Service, there is an option for the service provider to identify the material component of the contract separately and pay service tax at 12.36% on the service component. Alternately the service provider can opt for payment of service tax as a composite rate of 4.12% on the gross bill.

This option can be excercised by the service provider for each of the contract before the first remittance of service tax for the contract. Hence there is a tax planning possibility during the stage of quoting for any job by the service provider.

This unlike in the scenario of VAT wherein excercising the option for a composite scheme is for a financial year as against for a contract in service tax

CA V. Mohanakrishnan (Chartered Accountant) (401 Points)
Replied 26 September 2008

Further on opting for the composite scheme, the service provider is eligible to take input credit only on materials and on capital goods.

They need to forgo the credit on input services if opting for the composite rate of 4.12%

(Guest)

Originally posted by :CA V. Mohanakrishnan
"	Further on opting for the composite scheme, the service provider is eligible to take input credit only on materials and on capital goods. They need to forgo the credit on input services if opting for the composite rate of 4.12%	"

OFFICESELVA (Service) (515 Points)
Replied 25 October 2008

I think CA V. Mohanakrishnan is not correct. The service provider can avail input services and Capital Goods credit. BUT NOT INPUT CREDIT.

CA V. Mohanakrishnan (Chartered Accountant) (401 Points)
Replied 25 October 2008

absolutely right. it is the other way around input on materials is not available.

input on services is available.

thanks for the correction

Madhukar N Hiregange (Chartered Accountant) (38934 Points)
Replied 28 October 2008

The interior decorator who is invoilved in designing, advise etc is only cobvered under ID service. If that is so then liable.

If ID actually executes the job t\like the carpentar then he would not be liable since residential houses are not in the defintion of complex. However if the same job is done at appartments there couldbe a liability under WC entry.

(Guest)

Originally posted by :Madhukar N Hiregange

The interior decorator who is invoilved in designing, advise etc is only cobvered under ID service. If that is so then liable.

If ID actually executes the job t\like the carpentar then he would not be liable since residential houses are not in the defintion of complex. However if the same job is done at appartments there couldbe a liability under WC entry.

Is ID should register under both ST and VAT, please clarify

Siraj Hassan (Accountant) (32 Points)
Replied 22 November 2009

Sir we are executing turnkey interior design projects for software office in which we execute electrical, air conditioning, furniture, painting, civil works. We are still not registered under service tax. Will we be liable to pay service tax for the project done by us before november 2009 or we have to pay service tax for projects completed after getting registered with service tax?

What is the rate of Service tax for Works contract and Turnkey Interior Contractors.