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Work contract tax

Deepak Baghel (Accountant) (74 Points)

08 February 2013

What is work Contract Tax?

What is rate of WCT in UP? Please give reference of UP Sales Tax Authority.

Who is work contractor as per UP VAT Act?

How it is calculate with example?

is it deductible on payment basis or due basis?

Suppose If i did't deduct wct on Payment Rs 1000 Should i need to grossing up this figure? Like if need to deduct 4% WCT then i need to Grossing up with Rs. 1042. & deduct Rs. 42 as WCT

Thanks

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7 Replies

Deepak Baghel (Accountant) (74 Points)
Replied 10 February 2013

Kindly some one advice please

Sonu Kumar (Account Manager) (665 Points)
Replied 11 February 2013

1.The Contract Where Labour and Material both are used is called work Contract

2. WCT rate is 4% in Bihar........ when Bill is Certified by the client it is Deducted

3. Contractor Who Use Labour and Material Both for Contract

4. A Client who is certifying any Contractor Bill need to Deduct WCT @ 4%

for example

BHEL Certifying Bill of NCC for Rs . 1 Crore

Deduction Will be as Follow

TDS @ 2% - 2 00 000

WCT @ 4% - 400 000

Labour Cess @ 1 % - 1 00 000

Net Payble Amount after deduction - 93 00 000/-

BHEL Transfer Rs - 93 Lakh in NCC Account

Deepak Baghel (Accountant) (74 Points)
Replied 11 February 2013

Kindly reply on my last question:-

is it deductible on payment basis or due basis? Suppose If i did't deduct wct on Payment Rs 1000 Should i need to grossing up this figure? Like if need to deduct 4% WCT then i need to Grossing up with Rs. 1042. & deduct Rs. 42 as WCT

Thanks.