VAT ON BUILDERS

Yes,  It should be applicable for Builders, B,cos they used meterial form a physical goods (meterials) it is just like a Restourant nature they purchase tax free goods and prepare food after serving the tax chrage at 12.5%.

Building is an immovable property and hence not goods. However VAT is payable on the transfer of goods (Input Materials) involved in works contract. construction of building is a works contract and hece VAT is payable on input materials used in the construction.

Builders have to pay VAT on their purchase but they use the material for construction and  the end-product which is  building cannot be charged by VAT. But the material purchased for construction can be treated as deemed sale when they are used for production because builders construct the building under an agreement to sale with customers. So, in my opinion he can enjoy the benefit of tax inpu credit in this way as he is selling the material to customer in an altered way.

Please correct me if i am wrong.

HOW TO CALCULATE WORKS CONTRACT ON BUILDERS AND AT WHAT PERCENTAGE.

PLZ ADVICE

CMA.SHAKIL