What is works contract tax? Whose liability is it do deduct WCT? What are the penalties for non-deduction?

Question

My clients are in the construction business and currently do not deduct any WCT but only deduct 2.27 % TDS from all contractors who supply material+labour.

Answer 1

It is an established law that for the excution of one contrcat taxes can not be imposed eparately on Contractor and Sub Contrcator. If the sub-contractor is paying WCT/VAT on his turnover then the main contrcator will get relief on his related turnover. If main contractor s paying tax on his entire wc, sub contractor will not be liable for WCT/VAT. However, there may some prescribed rules and procedure for establishing the fact.