Builder Query: Shd Invoice for Material in Buyer Name or my Name?

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  1. NSK

    NSK New Member

    Iam a builder.One of my client sold his property and deposited the amount in LTCG. Iam constructing a house for him. He has transferred a part of LTCG amount to my current account for construction purpose. My query is
    1.In whose name (Myself or the client) I have to provide Vouchers and Material Purchase Bills?
    2.If I provide the bills in my name (as i have received the amount) will I be charged with service tax?
    3.I have utilized the amount in client's house construction. So how to avoid service tax for me?
    4.Already I have got 6 bills in my name. In such case how to deal with service tax if any to be levied on me?
    Kindly do help me.
     
  2. rudrabose

    rudrabose Active Member

    1. You have purchased the material and therefore the invoice would be in your name
    2. Irrespective of whether bills are in your name or clients name - Service Tax would be applicable on sale of under construction property. (Refer: http://www.charteredclub.com/service-tax-on-under-construction-property-3-09/)
    3. There is no Capital Gain arising in your hands and the capital gains is only arising in the hands of your client. Business Profit is arising in your case and the income would be chargeable to tax as per the income tax slab rates
    4. Bills should be in your name only as you have purchased them. If your client had directly purchased them and provided you the material - the bills would have been in the name of the client.
     
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