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ST Paid to Sub Contractor

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rajesh

Accountant

583 Points Posted on 09 July 2011

Dear Sir

I am a Contractor and I am Service Tax Collect from my Contractor and at same time i was Service Tax Paid to my Sub Contractor at Service Tax Paid Time I will Cen Vat Credit Taken on Payment to my Sub Contractor.

Exmp. I was Collect ST From my Contractor 10

and I am Paid ST to my Sub Contractor 5

Then i will paid ST only 5 is this correct or not

and Cen Vat Credit taken only i was Amount paid to My Sub Contractor or Bill Received my Subcontractor Plase Tell

Thanks

Replies (4)

U S Sharma

glidor@gmail.com

21068 Points Posted on 09 July 2011

in works contract there are two options

1) pay tax at full rate and avail input credit

2) avail abatement .pay tax @ 4% and forget input credit

choice is yours ..........

Madhukar N Hiregange

Chartered Accountant

39039 Points Posted on 10 July 2011

Under works contract where you opt for compostion - 4.12% or deduction under Not 12/2003 then the input services credit is available as well as capital goods credit. Inputs credit of materials would not be available. Sub contract credit is available under these 2 options.