civil work contract

[Ram Babu singh]

How to calculate service tax and vat on work contract and what will be the rate of vat ?

[Ganeshan Kalyani]

As per valuation rule, taxable value is 40% of the consideration in case the works is original otherwise it is 70% of the consideration to calculate service tax.

[Ganeshan Kalyani]

Vat rate is different in case composition scheme is availed or otherwise.

[YAGAY and SUN]

VAT Rate may vary from 5% to peak rate i.e. 12.50% to 15%. However, VAT Rate on works contract can be calculated on the value of actual material used or on abated value or on composition scheme as the case may be.

[DR.MARIAPPAN GOVINDARAJAN]

On observation from the queries, the queries are not complete in nature. If you ask the rate of VAT how can it be presumed your actual applicability VAT rate, since the same is different from state to state. Please give a complete picture of query so that correct advice may be given.

AI Summary

Service tax valuation for works contracts affects taxable value; VAT depends on material value, abatement or composition.
Taxation of civil works contracts depends on valuation abatements for service tax-different abatements apply to original works and other works to determine taxable value-and on VAT treatment which may be on actual material value, an abated contract value, or under a composition scheme, with VAT rates and applicability varying by state.