one of my client construct the buildings .He incured expense like material,labor etc.now he wants to sell building or single-single house of those building.Then is he liable to collect and pay service tax?If liable then on what amt.service tax is to be calculated?and which service is applicable?
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Building contractor
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Yes he is liable to pay service tax. Now if these houses are sold or rather entire amount of consideration is received by your client after the issuance of Completion certificate then on 25% of the value of the contract service tax is to be payable.
If the above conditions are not meet then service tax is to be paid on 40% of the value of the contract and liability to pay service tax of the service provider is only 50%. Remaining amount of tax is to be borne by the service receiver.
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