| WE ARE IN TO CONTRUCTION BUSINESS | ||||||
| WE RAISE INVOICE TO OUR CLAINTS LIKE THIS | ||||||
| GROSS AMOUNT | 75000 | |||||
| VAT @ 12.5 ON 75% OF GROSS AMOUNT | 7031 | |||||
| SERVICE TAX @ 10.3 ON 33.33% OF GROSS AMOUNT | 2575 | |||||
| TOTAL AMOUNT | 84606 | |||||
| IF OUR CLAINT PAY PART PAYMENT OF RS.50000/- HOW DO I CALCULATE WHAT IS THE SERVICE TAX INVOLVED IT???? | ||||||
| PLEASE TELL ME THE CALCULATION | ||||||
THANKS IN ADVANCE
BIJU
It is Depending up on our Assumptions i.e if u think Rs. 50,000/- Including All taxes calculate including tax.
I will clearly tell after some time ok.
The amount of Rs 50000 is cum tax amount means it includes both VAT & Service Tax
also as per rules service tax liabillty comes on whatever amount is collected from debtors.
Calculation will be as below:
Gross Amount 44323
VAT on above( 12.5% on 75%) 4156
Service Tax on gross amount(10.3% on 33.33%) 1522
Total 50000
Hi Biju,
Here is a formule that might help you in future as well. Since you people are in construction business, I would suggest you to go for compostion scheme for both VAT as well as Service Tax, simpler and hassle free.
x + (x*75%)*12.5% + (x*33%)*10.3% = Amt paid by client.
x + 0.09375x + 0.000343299x = Amt paid by client
1.094093299x = Amt paid by client
x = Amt paid by client / 1.094093299
x = Amt towards your construction services.
(x*75%)*12.5% = Amt of VAT liability on amt (x).
(x*33%)*10.3% = Amt on Service Tax liabilityon amt (x).
" And the above formule can be modified as per change in tax rates."
Have a great day.
Welcome ( For your thanks in advance)
If you receive against your invoice, you have to give same treatment as followed in invoice preparation.
Based on above, I agree with poorima........
CAclubindia
