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Vat on works contract

669 views 1 replies

Anish Handa

Partner

24 Points Posted on 15 August 2011

My Company has VAT and CST registration for dELHI, we executed an Works Contract project in Mumbai for a client based in Mumbai. The billing will be from our Delhi Officew. My questions are

Since the works contract has been executed outside Delhi, is VAT applicable on the bill amount ? ie. Should I charge VAT to the client ?if yes what percentage
The VAT that I am paying for materials bought in Mumbai and consumed there for the project, can I offset that in any way ?
According to me, since I dont have VAT registration of Mumbai, I am paying VAT in that state, which is additional cost to my company, is it true ?
Is there any way by which I can save on the VAT being charged or get concession on VAT on material purchase in Mumbai ?

Replies (1)

Kapil Dev

Manager Indirect Taxes

65 Points Posted on 17 August 2011

1. CST is appliacable/Concession rate against declarataion Form C

2. No.

3.Yes

4. Only way is to get you company registered under Local VAT Act. In that case you can claim set off against vat paid on inputs. You would also be given deduction in respect of goods purchased by you under section 3,4,5 of central act. Pls. not that VAT and CST is chargeable on Material part of the contract.