Sir
We are manufacturing co we wish to construct new building so we made an agreement with contractor who will construct the building with material which will be submitted by us. Contractor will raise the bill only for service potion. Now i want to know whether service tax 15% will attract on service portion bill or 15% on 40% i.e. the service portion including the supplied material? I need your suggestion very sincerely.
With thanks & regards
Samik Chaudhuri.
Service Tax of 15% Applies to 40% of Total Cost; Both Parties Share Liability Equally Under Relevant Notifications A manufacturing company plans to construct a new building and has contracted a builder to provide services using materials supplied by the company. The inquiry concerns whether the service tax of 15% applies to the service portion or to 40% of the total, including supplied materials. Responses clarify that the service tax is 15% on 40% of the gross amount, with both service provider and receiver sharing the tax liability equally, as per relevant notifications. The tax components include 14% service tax, 0.5% Swachh Bharat Cess, and 0.5% Krishi Kalyan Cess. (AI Summary)
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