Wednesday 28 September 2016

Work Contract Tax (WCT) under DVAT

Work Contract Tax (WCT) is now solely under jurisdiction of Sales tax Department, Delhi. WCT is applicable where work or composite supply is being executed i.e.contract consisting of supply & service both. The same concept has also applicable in all the states. The Amount Payer have to required to deduct WCT and deposit the same in the local Sales Tax authority.
Registration: A person required to deduct tax at source (WCT) shall apply for registration in Form DVAT 44 and obtain Tax Deduction Account Number (TAN) with in 7 days from the date on which tax was first deducted or deductible. TAN will be issued by the Sales tax Department in form DVAT-45.
Tax Deposit: Persons who have been allotted TAN are required to deposit the tax deducted within fifteen days following the month in which deduction is made and file a TDS return in Form DVAT 48 within a period of 28 days from end of the quarter in which the tax is deducted. Any delay in depositing of the TDS amount and failure to file TDS returns is subjected to interest and penalties.
Input: The works contractor or dealer on whose behalf the tax has been deducted at source can claim a credit for the TDS amount through the TDS certificate issued against deduction of TDS by the Deductor.