GST Impact on ongoing Construction Works contracts with Different Govt. Department And Pvt Company (For Civil Contractors)
Specific transition provision has been stipulated vide Section 159 and 160 for works contract/ periodic supplies as under:
Section 159, the goods and/ or services supplied on or after the appointed day in pursuance of a contract entered into prior to the appointed day shall be liable to tax under the provisions of this Act.
Section 160, Notwithstanding anything contained in section 12 and 13, no tax shall be payable on the supply of goods and/ or services made on or after the appointed day if the consideration for the said supply has been received prior to the appointed day and the duty or tax payable thereon has already been paid under the earlier law’
> As per the above, it appears that in case of periodic/ continuous supply of goods/ services, GST Act would not apply on advances received prior to the GST law for goods/ services to be provided during the GST regime, provided tax has been paid on the same. This provision does not cater to the scenario where tax has not been paid, but is payable under the earlier law post enactment of the GST regime.
> Also, there is no provision for treatment of supplies prior to the GST law, where either the invoice has not been raised for the same, or payment has not been received, or tax has not been paid, prior to enactment of the GST law. This could result in dual taxation, both under the previous regime as well as under the GST regime.
Contractors would need to examine the coverage of the transition provision as to whether implications for all its possible transactions during the transition period are clear.
Key Action points in last four days (27th June to 30th June-2017)
1. Contractors should raise running account bills for the work done till 25.06.2017 before 06.2017, so the impact of GST @18% can be avoided, but contractor should take receiving of bills submitted to the contractee (client of the contractor) for his record.
2. If any Advance payment has been received from contractee (client of the contractor) before 30.06.2017 then Contractor should pay Service tax @6% to avoided impact of GST @18%. In case the project is exempted under notification no. 25/2012(service tax) than in such case service tax shall not be payable. However it very important to show exempted/Taxable Work Contract service in ST-3 return (April 2017 to June-2017)
Author Bio
Respected Sir,
A Sub-Contractor takes contract for construction of roads on which it charges 18% GST on forward charge basis to the main Contractor.
It also take contract for transportation of materials/ goods on truck from one place to another. Whether it can opt for RCM on services of transportation of goods on truck from one place to another or it has to charge GST on forward charge basis since the main business of the client is taking contracts from contractor. And transportation of goods is not the main business of the client.
Work order issued from railway for civil and earth work before GST what is GST rate is 12
Dear Sir
Regarding Contracts taken prior to GST regime i.e., before 01.07.2017, the price does not include GST but includes VAT and there is exemption of Service Tax on Road projects. What is the applicability of GST for ongoing projects from earlier period i.e., 01.07.2017 and also major portion of the projects consist of Earth work or Earth cutting.
Please clarify me.
Regards
K K Senapathi
I AM GOVT. CONTRACTOR AND PROVIDE SERVICE FOR DRAIN CLEANING.HOW CAN APPLY GST.ON THAT CASE GST IS APPLICABLE OR NOT IF YES HOW CAN RAISED BILL TO GOVERMENT DEPARTMENT.
Sir, how the refund will be calculated in case the work has been awarded before 30.6.17. Work done by the contractor under work contract w.e.f. 1.7.17 and onwards and gst paid by him @18%
WHAT IS THE LIABLITY OF A DEALER HAVING CONTRACT AWARDED ON 01/06/2017 AS A CIVIL CONTRACT. AFTER THIS THE GST ACT IMPLIMENTED ON 1/7/2017. NOW HOW THE TAX IS PAYABLE THIS WORK WAS DONE AFTER 1/7/2017 AND HOW THE INPUT TAX CREDIT ON THE GOODS PURCHASED IN GST WILL BE AVAILABLE FOR HIM.
When a work order civil construction ofcivil work before Gst bill. Then I will pay a Gst bill tax.
When a work order civil constrsction work before a Gst bill. Then I will give a Gst bill tax.
sir, when i purchase a flat [on going project] can i pay GST and that also which amount from arrive GST and what is the percentage
sir, when i purchase a flat,, now it’s ongoing project,
can i pay GST and what is the percentage ? If it’s ok, can i calculate the GST in the construction cost ?
pl clarify.
if government civil contractor has given contractor to sub-contractor what is GST rate
HELLO SIR , GOVERMENT PANCHYAT SE WORK ORDER HAI UNKA GST MAI TAXATION KYA RAHEGA.
i have 24 labour can gst is applicable on me ? if yes then how much tax slab on me, and tell me other criteria
What is the Exact GST rate on Civil Works like roads, Drains etc.. under ULBs?and also please explain Calculation process of GST on above works.
What is the impact of G S T on Defence Contracts?
Sir,
Under Central Excise notification No. 12/2012, dated 17th March, 2012,
certain goods supplied for providing potable water to humans/animals
get Excise exemption against PAC certificate issued by the District Collector.
What will be the position after 1.7.2017 of ongoing supplies
which are partly executed with ED exemption?
Since Excise duty is discontinued after 1.7.2017,
are there any parallel provisions for exemption under GST?
Please reply. Thanks.
Pankaj Taparia
Indore
#9425056357
ON PURCHASE OF PLANT AND MACHINERY FOR CONSTRUCTION WORK, WILL INPUT TAX CREDIT WILL BE AVAILABLE ? CAN IT BE ADJUSTED WITH GST LIABILITY UNDER WORK CONTRACT?
Sir, Section 159 and 160 of CGST Act,2017 do not seem to discuss WCS.
Prior to the imposition of GST, service tax was exempted on construction services of roads and bridges. Now on introduction of GST ( Indirect taxes under one roof ) Service Tax is included in GST. What is the impact on construction services of roads and bridges ?
Very Informative and concept clearing note. Thanks…