Tax on aluminum fabricating work

If he gives u a bill, in which the materials used and labour charges are shown sepratley then ST @ 12.36% will be charged on the labour charges and VAT 4%(say) will be charged on the materials used. If he gives u a composite bill were labour charges and materials are not shown sepratley then he will charge u @ 12.36% ST.

Not very sure, please wait for others to reply.

Service tax is only on service portion of the works contract and VAT/Excise on Material portion.

Even if you get pucca bill, chances are less that the tax will be deposited with government.

That is why govt. brought in the draconian reverse charge laws wef 1-July-2012 where service receiver has to get registered and pay service tax on 75% of value of services in works contract...If you are individual then no worry. But if you are small business then you have to get yourself registered with service tax and pay it before 5th of next month...

Unfortunately what govt. does not realise is that these kind of laws with only encourage kuccha business instead of pucca. So they must bring down service tax rate to 6% to get good compliance.

   Mr VS Gusain

  The vat on alluminium sections used in the fabrication will be @ 4%(may be now 5%),Here 75% of the value is supposed to be that of material and 25% of labour and services. VAT is chargeable @ 4%(or 5) on Rs45,000/- and 12.36% on 15,000/.

As responsible citizens we should ask for pucca(regular) invoice,but tax evasion is so rampant,that your contractor most probably won,t pay it to the govt.Now it is upto you.......MJK