LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Difference between service wct and vat wct

jafer (studies) (194 Points)

26 December 2012

Hi,

Is there any difference between service ( work in contract tax) and vat ( work in contract tax). If they are then, what are the differences?

Thanks in advnce

Hi, Is there any difference between service (work in contract tax) and vat (work in contract tax). If they are then, what are the difference? Thanks in advance.

Read more at: /forum/difference-between-service-wct-and-vat-wct-232688.asp#.UNoQHnfBZdg

Reply
Follow
Share

4 Replies

Ashwani Narnoli (.) (1843 Points)
Replied 26 December 2012

As far as I am concerned the amendment in service tax has now made clear that wct should be treated as per the service tax law

MJ Krishnamurthy (ACCT(Retd)) (7197 Points)
Replied 27 December 2012

A works contract involves use of both labour and services along with material. The labour and services are related to Service Tax and material part is related to VAT.........MJK

Sonu Kumar (Account Manager) (665 Points)
Replied 23 January 2013

Vat (WCT) and Service Tax (WCT) Both are Diffrent.

Vat is Collected by State Government it does not Consider Service Tax Rules as 40% part for Service tax and 60% for Material.

Each State has its own rule on Vat Wct........... In Bihar Certain Deduction are given from Gross Revenue in Case of Work Contract.............

1. Labour Charges

2. Wages

3. Expenses on Planning

4. Store Consumable

5.Other Expenses Directly Incurred for WC

6.Labour Welfare Expenses,

7. Profit Proportion to Contractors

after Deducting above expenses we got Net Revenue, after that we divide net revenue in proportion to Material Used in Construction i. e. 13.5% and 5% and Charge Vat on proportinate Amount. and we get Output Vat Tax

After that we Deduct Input Tax Credit and TDS-WCT and Reached at Vat Payble

Thanks