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Re: VALUATION METHOD FOR TAILORING SERVICES
Please suggest us appropriate valuation method for tailoring services as being provided ( on contract basis ) by one of my client being individual ( having turnover/ gross receipt more than 20 lacs per annum ) to a PVT LTD company . Query : whether service tax to be charged on sixty percent value of gross bill amount like in case of work contractors or it should be the full 100 % gross bill amount . Tailor also having 4 -5 sub tailors on contract basis
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Sir,
If the gross receipts are constituting solely of labour charges/ services then you have to charge 100 % on the gross bill amount i.e.12.36 %. But if it constitutes of material + labour and the usage of material can be substantiated then you can go in for the charging on 60 % of gross bill amount and pay tax and file under works contractor. |
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Traditional tailoring and stitching is not covered in the ambit of service tax However, embroidery work, designing like cartooning, quotes, tattoos etc. are covered. In ready-made garment industry, most of the big brands collects embroidery orders from the customers and get it done through local talented tailors. Such activities may fetch job work income charged per garment or item and in case of high-value professionals commission/fees charged on the basis of hours or nature of involvement |
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