VAT ISSUE IN SUB CONTRACTOR

[krishna besta]

Dear Sir,

 

We are in confusion to file the Vat Returns.

 

We have a Holding Orgnisation. We got Construction contracts from Govt.  We given some portion of work to sub contract who is the Part of Group of Organization.

We paid all sales tax returns which is given inclusive of sub contractors materails.

Is this required to file the VAT returns in the same manner by Sub contractor also.

 

Please clarify the VAT issue in  sub contractor point of view.

 

[YAGAY andSUN]

Yes, it is mandatory to file the statutory returns by the Sub-Contractors under APVAT Act.

[krishna besta]

How it would be show in APVAT Returns. Either shown under Tax Clasification @ 5% or 14.5% or Exempted Goods. Already VAT Paid by the Main Contractor, if the subcontractor filed returns with Tax payment it makes double. How it would effect shown in subcontractor Sir(S). Whether the main contractor is required to issue the 501 Form or not required to issue.

AI Summary

VAT filing requirement for subcontractors may create duplicate tax reporting when main contractor has already paid VAT. Under the APVAT Act subcontractors must file statutory VAT returns even when work is performed for a related group entity; the query concerns correct reporting classification (standard, reduced, or exempt), the risk of duplicate tax reporting where the main contractor has paid VAT inclusive of subcontractor materials, and whether issuance of a Form 501 by the main contractor is required to reconcile or avoid double reporting.