TaxTMI 
TaxTMI 
A company is engaged in the construction of residential building (consisting 4 flats), carried on as construction contract including materials, what is rate of tax in normal and under composition scheme, if possible prescribe the required procedure
Rate applicability in composite scheme
11 Jul 2009 
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Service tax on composite construction: deduct material value or opt composition scheme to determine taxable contract value.
Service tax treatment for construction contracts combining materials and services depends on the chosen method: if the supplier deducts material value from the gross contract price, service tax applies to the net service portion; under the composition scheme a flat composite rate applies and new contracts must include the value of free materials used in civil work when calculating the composite levy. (AI Summary)
Service tax treatment for construction contracts combining materials and services depends on the chosen method: if the supplier deducts material value from the gross contract price, service tax applies to the net service portion; under the composition scheme a flat composite rate applies and new contracts must include the value of free materials used in civil work when calculating the composite levy. (AI Summary)