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Service Tax on Xeroxing

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Jigna

none

28 Points Posted on 15 December 2010

One party give the service of printing of Xerox copies. The machine belongs to uthe Company . He is providing the paper and the service of Xeroxing and he is charging @ 48 paise per copy.Ink, catraiges,oiling & maintenance of the machine is done by that person only.

While billing the person who is giving the service of xeroxing is charging VAT @ 5% on 75% of bill value and service tax @ 10.3% on 100% of bill value. Is this ok?

Can Service Tax & VAT be levied together? If yes then what will be the proportion of bill amount on which the service tax and VAT will be levied?

Kindly reply as it is urgent..

Thanks

Replies (2)

CA Pratik Dharod

Bussiness

121 Points Posted on 15 December 2010

Xerox is a Works Contract.
So, both VAT and Service Tax are applicable.
VAT is leviable on the value of goods(Transfer of property in goods).
Service Tax is leviable on the labour component.
General Bifurcation is 75% Material and 25% Labour.
For leviablity, exemption of 10 lakhs to a small service provider will be available