Clarification reqd. on service tax - works contract

Mike Augustus (Partner) (54 Points)

21 August 2012  

Hi All,

With regard to the recent amendment in Service tax, require clarification on the following with regard to Works contract - original works;

 

i)  has the composition scheme been scrapped wef 1 July 2012? i.e. the option to pay service tax on 40% of the invoice amount? (the materials are all misleading)

ii) with the reverse charge mechanism in place, is the 50% borne by the service recevier to be paid of his/her pocket  or is that 50 % to be withheld from the service providers liability and paid on his behalf by the service receiver?

 

Thanks.

- Mike