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Service tax liability for subcontractor

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NICKOONJ VANANI

ARTICLE

45 Points Posted on 09 March 2017

Mr. X is having a business of labour job work. Till today he was doing labour job work contract at small scale . And so he hasn't registered his self under service tax.

In current year he get a big contract with Mr. Y .

This labour contract work is estimated to cross 50 lakh.

Under this contract , Mr. X will provide labour job work for the construction of OVER BRIDGE .

Mr. Y has received a tender for construction of over bridge . Hense Mr y is providing service to the government and Mr x is providing service for that over bridge..

In this case , Mr x is liable to get registered under service tax and to pay service tax ?

Replies (1)

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

121521 Points Posted on 10 March 2017

Under the taxation based on negative list, en carried forward. Therefore the sub-contractor providing works contract service to the contractor who is providing exempt works contract services, would also be exempt from service tax, but services provided by architect, engineer or persons providing services other than works contract service to the contractor providing exempt works contract service, would not be exempt from service tax.