Balasubramani (Senior executive) (90 Points)
18 September 2014Dear Sir,
Mr. X is Land owner, Mr. Y is Developer,
Both are entered in JV for develop the land.
Mr Y and Mr. Z (Purchaser) Entered into works agreement
Mr y and Mr.Z Entered into civil works contract, Total value of work contract 23 Lakhs, Out of which 8 Lakhs included land, Mr. Z Not register the works contract, The purchase and developer UDL is registered.
Now i want to go Composite Method, Developer not manitain any books How Much I pay the VAT in Tamil Nadu,
Please help to guide me
Greetings Balasubramani,
As the developer has not maintained any books, the composite rate on this civil works works contract will be 2% of 23 lakhs. In my opinion it is irrelevant at this point if Mr. Z is not a registered person because of section 6.
As per section 6 of the Tamil Nadu VAT Act, Mr. Y has to meet his VAT obligation out of the margins earned from contract with Mr. Z only i.e. Mr. Y cannot recover the same from any one and as you may know no input tax credit will be allowed.
Kind regards.
Balasubramani
(Senior executive)
(90 Points)
Replied 18 September 2014
First I say thanks to you !!
Land value is included in works contract, I want to pay the VAT also third party property
Land Name transfer from X to Z Directly
But Y has collect the money from Z and pay to X .
At the time of Land regestriation Z has pay regestriation fees and stamp duty to goverment.
In this case Y Develper want to pay vat on land. (Land is fully third party property)
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