Advance Payment to Works Contract in ST-3

[ANIL MANTRI]

Sir, the company had made advance payment of ₹ 20 lac for a works contract, and till 31/03/15 work of ₹ 14 lac is completed and bill are received for the same. Sir how to show this in ST-3. The company had paid service tax under reverse charge on ₹ 20 Lac

[PAWAN KUMAR]

Dear Sir,

As per my view, you have paid service tax in advance and adjusted some of the tax. you can mention the same in the section provided for advance tax payment of ST-3.

AI Summary

Advance payment under reverse charge: disclose advance service tax in ST-3 and adjust as work is billed. Tax paid under the reverse charge on an advance for a works contract is to be treated as an advance tax payment and disclosed in the ST-3 return's advance tax payment section; as portions of work are completed and billed the taxpayer may adjust that advance against liabilities and reflect such adjustments in ST-3.