Works contract (Composition scheme)

[sunil jain]

As per rule 3(3) of Works Contract(Composition Scheme for Payment of service Tax) Rules,2007 dt 22.05.07,the taxable service provider who opts to pay tax as per these rules shall exercise such option prior to payment of s.tax. We need a clrification whether such excersing of option need to be filed with S.Tax Deptt. or simply on self basis without any formal intimation to Deptt.

AI Summary

Service Providers Can Opt for Works Contract Composition Scheme by Starting Payments, No Formal Filing Required Under Rules. A query was raised regarding whether a service provider opting for the Works Contract Composition Scheme under the Service Tax Rules, 2007, must formally file their option with the Service Tax Department or if self-declaration suffices. One response suggested that filing might not be necessary, as no rule mandates it, and beginning payments under the scheme constitutes exercising the option. Another response noted the absence of a filing requirement in the rules and indicated that starting payments under the Works Contract category effectively exercises the option.