Service Tax on Construction

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..... Service Tax on Construction
Query (Issue) Started By: - CA BALRAM PANDEY Dated:- 10-3-2014 Last Reply Date:- 27-3-2014 Service Tax
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Service Tax
Dear Professional Colleagues Please guide me on the following issue:- A builder/developer is constructing building and starting booking of flats before completion of construction, the activities flows in following manner: 01-01 .....

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..... -2010 Date of construction started. 01-01-2011 Date of First Booking of Flat Stage of completion Date of construction date of realisation 4th Floor 01-04-2012 31-05-2012 (50 percent of Flat Value) 10th Floor 01-04-2014 31-05-2014 (90 percent of Flat Value) Possession by Deed of conveyance 01-10-2014 01-10-2014 (100 percent of Flat Value) Based on the above please guide me that, what will be .....

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..... the point of taxation for each construction stage, as it is a continuous supply contract. Thanks in advance Balram Pandey Reply By Brijesh Verma: The Reply: POT shall early of : 1. Invoicing 2. Completion (where completion in case of construction is every such event where customer is obliged to pay) 3. Payment Reply By YASHAVANTH RENUKA: The Reply: Dear Pandey, The Following method to .....

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..... be used as per Accounting Std. ( AS) 7 (2002). You can book revenue on accrual basis in case of Income Tax. You can book revenue on completion basis for Service Tax as per POT Rules. Year 1 Year 2 Year 3 Initial amount of revenue agreed in contract 9,000 9,000 9,000 Variation - - 200 200 Total contract revenue 9,000 9,200 9,200 Contract costs incurred up to the reporting date 2,093 6,168 8, .....

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..... 200 Contract costs to complete 5,957 2,032 - - Total estimated contract costs 8,050 8,200 8,200 Estimated Profit 950 1,000 1,000 Stage of completion 26 percent 74 percent 100 percent
Discussion Forum - Knowledge Sharing .....

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