Works contract under composition Scheme #pdf
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Hi,
Payment of service tax on works contract under composition Scheme:
Rule 2A(ii) Service tax Determination of value ) Rules 20016: Under composition scheme service tax
payable at specified percentage of “Total amount” i.e ,total value of value of contract. So in this
case :
1. ABC Ltd is opted the composition scheme as per rule 2A(ii) Service tax Determination of
value ) Rules 20016
2. ABC Ltd levied 15 % on 30 %( i.s specified percentage ) of Total amount.
3. So RCM will not applicable ( need to verify HUF/Individual/Firm)
4. Cenvat credit ( i.e, Service tax input) is not available
5. ABC Ltd Invoice should be only Gross amount ( i.e No separate amounts for goods &
Services)
Requirements :
1. ABC LTD should disclose Service tax Registration number on face of the Invoice
2. Service tax should be bifurcated i.e service tax@14%, SBC@.05% & KKC@05%
Particulars Amount
Total Value for contract 100
VAT 14.5% on 75% of Total Value of contract 11
Service tax@14.5% on 30% of Total Value of
contract 4.35
Total Value for contract 115.35
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