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Insurance for Fiat Cars - Discussion

Discussion in 'Insurance & Loan Reviews' started by Ravi, Jun 17, 2010.

  1. VahanPujari

    VahanPujari Staff Member Janitor

    Messages:
    2,303
    Mumbai
    Re: Insurance - Q&A

    As far as I know, your payment should include only Rs. 500 + 50% of any plastic parts (not covered under insurance to the level of 100%). VAT should not be entirely charged on you but to the extent of your contribution only towards plastic spare part (50%)
  2. Re: Insurance - Q&A

    Vat should be paid by the insurance only. I have claimed insurance from Bajaj and I just payed for the policy excess (Deductible) and rest all was settled by the insurance company. I would suggest you talk with the Insurance company and check why were you charged extra.
  3. Re: Insurance - Q&A

    Just enquired with Bajaj Allianz and TATA AIG.
    Got the below reply and i am reproducing what i understood.

    The VAT mentioned is VAT on WC (work contract).
    As per Tamilnadu work contracts (labour) act (??), 8.75% of labour will be charged as Work Contract tax.

    This WC tax will not be payable by the insurance company and will have to be borne by the insurer.

    This is mentioned as "VAT on WC" in the invoice.
  4. VahanPujari

    VahanPujari Staff Member Janitor

    Messages:
    2,303
    Mumbai
    Re: Insurance - Q&A

    What I can see in above breakup is that there is no spare part involved & the entire cost was towards labour (painting). Total tax 10% service tax + 2% edu cess + 1% S&HE cess +8.75% VAT comes to 21.75%. Isn't that too high? Also, if Service tax is paid on labour, still VAT on WC applicable?
  5. Re: Insurance - Q&A

    Total tax inlcuding VAT on WC add up to to 19.95 %
    Service tax and edu cess is 10.2 % (edu cess is 2% of service tax).

    VAT on WC is applicable even it Service tax is levied. This is in addition to all other taxes. !
  6. VahanPujari

    VahanPujari Staff Member Janitor

    Messages:
    2,303
    Mumbai
    Re: Insurance - Q&A

    This means any services you availed, there will be a tax of 19.95% ? Thats too high, isn't it?
    If you've any CA friend or a tax consultant, just try to ask him if this is right as 19.95% looks very high figure.
  7. Re: Insurance - Q&A

    I checked with our office tax consultant.
    Its a fact that 8.75% VAT is applicable on all labour charges. This is over and above the other taxes.
  8. Ravi

    Ravi Staff Member Janitor

    Messages:
    6,001
    Bangalore
    Grande Punto 1.3
    Re: Insurance - Q&A

    Thank you.
    Onyl thing, I got 100% as IDV in my 1st year insurance.
  9. VahanPujari

    VahanPujari Staff Member Janitor

    Messages:
    2,303
    Mumbai
    Re: Insurance - Q&A

    Ok.
    But still am intrigued why VAT is not payable by insurance company when Service tax is payable? Someone having tax expertese can explain. :anyone
  10. divx

    divx

    Messages:
    9
    Bangalore
    Re: Insurance - Q&A

    For my Punto, ICICI Lombard has stated

    First Year IDV = 525000/- Rs (approx),
    Second Year IDV - 44700 /- Rs (approx),

    Looks like value of the vehicle has reduced 15% flat on ex-showroom price. Ex-showprice of Punto Emotion MJD was around 5.4L in bangalore in Aug-2009.

    Can other who have renewed their insurance, please put their current and old IDV's.

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