12%
GST Rate on Works Contract
| Description | HSN Code | GST rate |
|---|---|---|
| Works contract mostly involving earth work to government | 9954 | 5% |
| Oil exploration works contract (construction) | 9954 | 12% |
| Works contract by sub contractor to main contractor (construction) who in turn provides above services to the government | 9954 | 12% |
Is subcontractor exempt from GST?
It is clearly mentioned that whosoever is supplying the pure labour contract services for the construction of a civil structure or any other original works under PMAY is exempted from GST. Therefore, the sub-contract of pure labour will be covered under Entry 10 of Notification no.
What percentage do subcontractors charge?
The Construction Industry Scheme ( CIS ) deduction rates are: 20% for registered subcontractors. 30% for unregistered subcontractors. 0% if the subcontractor has ‘gross payment’ status – for example they do not have deductions made.
What is the rate of GST on construction?
Major Construction materials and input services attract 18% GST….GST Rates on Construction Industry- An Analysis.
| Cost of material and Labour | Rs. 75 |
|---|---|
| GST 12% | Rs. 12.77 |
| Less input tax credit | Rs. 6.07 |
| Total sale consideration | Rs.112.77 |
Is GST applicable on Labour work?
GST is applicable on all goods and services, including the service of the labour contract.
Can we claim ITC on works contract?
Works contract ITC shall not be available for any work contract services. ITC for the construction of an immovable property cannot be availed, except where the input service is used for further work contract services. They cannot claim any ITC on the works contract.
