Gst - works contract - itc

ITC / Input 225 views 5 replies

CA CHETAN GUPTA

588 Points Joined September 2009

Works Contract Service ( Contractor) - To Govt., Local Municipal Corporation (Roads, Sewers etc.)

Is Input Tax Credit Available on Goods purchased and used like Cement, Sand etc.???

How to Calculate GST on the Contract Value?

Contract Amount Rs. 1 Lakh

GST @ 12% would be 1 Lakh x 12 % = 12000/- { TAX EXCLUSIVE }

GST @ 12% would be 1 Lakh x 12 / 112 = 10714/- { TAX INCLUSIVE }

(AMOUNT RECEIVABLE from GOVT. i.e. CONTRACT VALUE is Rs. 1 Lakhs Only. No Extra Amount in the Name of TAX can be recovered.)

Kindly Quote Any Relevant Notification or Section.

Thanks.

Replies (5)

1. Refer Sec 17(5) to know about restricted input tax credits. ITC paid on Purchase of inputs like cement, sand etc, will be allowed to you as there is no restriction on it in your case.

2. Refer your contract, if it mentions that the contract amount is exclusive of all taxes or it mentions that taxes are applicable separately then GST shall be 12% on 1 lakh.