If contractor issued bill inclusive of service tax, on which amount tds is deductible, contract amount or total amount including SERVICE TAX ??
Say
Contract Amount : 100
ST : 12.36
Total : 112.36
If contractor issued bill inclusive of service tax, on which amount tds is deductible, contract amount or total amount including SERVICE TAX ??
Say
Contract Amount : 100
ST : 12.36
Total : 112.36
| Originally posted by : Janak | ||
 |
If contractor issued bill inclusive of service tax, on which amount tds is deductible, contract amount or total amount including TDS ?? |  |
TDS shall be deducted without including the service tax, if it's charged separately.
.
CBDT vide Circular No. 01/2014, dated 13.01.2014, has clarified that wherever in terms of the agreement/contract between the payer and the payee, the service tax component comprised in the amount payable to a resident is indicated separately, TDS shall be deducted on the amount paid/payable without including such service tax component.
Please clarify what do you mean by inclusive of service tax:
Say service amount is 100/- and service tax thereon 12.36/-
then is the bill a single amount of 112.36/-
or
service charge 100/-
service tax 12.36/-
total 12.36/-
??
If Contractor issued Composite bill then TDS should be deduct on Gross Value of Bill.
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