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Service tax on works contract

Queries 589 views 1 replies

Krishna Prasad

Partner

260 Points Joined August 2009

IN COMPOSITION SCHEME FOR SERVICE TAX ON WORKS CONTRACT, WHETHER

A.INPUT CREDIT ON SERVICES USED IN OUTPUT SERVICES BE AVAILED OR NOT

B.IF WORK WAS SUB CONTRACTED THEN THE SERVICE TAX PAID TO SUB-CONTRACTOR BE AVIALED OR NOT

C.IF SERVICE TAX WAS PAID BY THE SERVICE RECEIVER ON REVERSE CHARGE MECHANISM THEN WHETHER SERVICE TAX PAID CAN BE CLAIMED AGAINST SERVICE TAX PAYABLE ON CONSTRUCTION CONTRACTS ON COMPOSITION SCHEME OR NOT.

PLEASE CLARIFY

Replies (1)

Madhukar N Hiregange

Chartered Accountant

39039 Points Joined September 2008

There is no compostion scheme under ST.

However under valuation rules - ST on 40% ( original works) and 70% ( others) is payable when actual value of material not available.

Under any of the WC options credit of input services from various vendors including a sub contractor is available whether paid to vendor or paid under reverse charge mechanism.