TaxTMI 
TaxTMI 
Dear Experts,
We have given a contract for new building construction in which Builder will be bear every expenses except cement and steel. Cement and Steel will be provided by the owner. How will come out the service tax value. Pl advice.
Thanks
Work Contract Service
15 Dec 2012 
5 Replies 
1493 Views Asked by
Valuation of owner-supplied materials increases taxable contract value, triggering partial reverse charge for specified suppliers and recipients.
Valuation for service tax on a works contract includes the value of owner-supplied materials in the gross contract value, and service tax is computed on that gross amount. A partial reverse charge may apply such that, when specified conditions regarding the supplier and a body corporate recipient are met, the tax liability is apportioned between service provider and service receiver; otherwise the provider must charge and remit the full tax. (AI Summary)
Valuation for service tax on a works contract includes the value of owner-supplied materials in the gross contract value, and service tax is computed on that gross amount. A partial reverse charge may apply such that, when specified conditions regarding the supplier and a body corporate recipient are met, the tax liability is apportioned between service provider and service receiver; otherwise the provider must charge and remit the full tax. (AI Summary)