Which Taxes are Applicable for Work Contract

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....hich Taxes are Applicable for Work Contract<br> Query (Issue) Started By: - Sumt Patel Dated:- 30-3-2012 Last Reply Date:- 19-4-2012 VAT + CST<br>Got 3 Replies<br>VAT / Sales Tax<br>We are a Contractors & Fabricators of Aluminium & Steel - Windows/ Doors/ Partitions/ Ceiling/ Structural Glazing/ Cladding work etc. We purchase a material (i.e.: Aluminium/ Glass/ Plywood/ Hardware, etc.) from mark....

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....et & Also taking a service of Powder Coating / Anodizing on Aluminium of Steel form outside service providers & then we can fabricates all of above & do a installation (fixing) on site. So while preparing an Inoice Which Taxes are Applicable & How many Percentges. VAT/ CST/ ST/ WC VAT --- ? Thank you, Reply By Pradeep Khatri: The Reply: You will have to charge WCT @ 8% as mentioned in the MVA....

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....T Act. Reply By Jatin Mistry: The Reply: Thank you for your valuable reply. I have discussed with my accountant today. He has also agreed to charge only WC VAT @ 8% on total value of work. But I have 1 more query as follows: he had also suggested that, there is 1 more option that we can also raise a bill as follows: Saperate Bill for MATERIAL (i.e.: Aluminium Window/ Door/ Partition, etc.) w....

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....ith M VAT @ 12.5% & Saperate Bill for LABOUR - Installation on site - Fixing (i.e.: only Labour Charges for Fixing on site) with M VAT @ 12.36%. is it also acceptable or not ?? pls guide as soon as possible. Thank you. Reply By vijay kumar: The Reply: Dear Sir, since it is a case of works contract, it is liable to VAT (as per your state VAT act) on the material value sold (which is stated....

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.... to be 8%) and Service Tax on the labour component. Presently, service tax is 12.36% on the labour component with full cenvat facility or u may go for composition scheme of 4.8% without any cenvat facility on inputs. Thus, as stated u will have to raise two separate invoices - one for material value and another for service value. For your information, there is a threshold exemption upto Rs.10 lakh....

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....s in each Financial year on service tax.<br> Discussion Forum - Knowledge Sharing ....