Friday, April, 20, 2018
  • Nation
  • World
  • States
  • Cities
  • Business
  • Sport
    • IPL
    • Commonwealth Games 2018
  • Entertainment
  • Galleries
  • Videos
  • Life Style
  • Specials
  • Opinions
  • All Sections  
    States Tamil Nadu Kerala Karnataka Andhra Pradesh Telangana Odisha
    Cities Chennai DelhiBengaluru Hyderabad Kochi Thiruvananthapuram
    Nation World Business Sport Cricket Football Tennis Other Education
    Entertainment English Hindi Kannada Malayalam Tamil Telugu Review Galleries Videos
    Auto Life style Tech Health Travel Food Books Spirituality
    Opinions Editorials Ask Prabhu Columns Prabhu Chawla T J S George S Gurumurthy Ravi Shankar Shankkar Aiyar Shampa Dhar-Kamath Karamatullah K Ghori
    Today's Paper Edex Indulge Event Xpress Magazine The Sunday Standard E-paper
Home Business

Planning to buy new home? First, check GST from builders

By J Deepthi Nandan Reddy  |  Express News Service  |   Published: 16th April 2018 02:10 AM  |  

Last Updated: 16th April 2018 06:04 AM  |   A+A A-   |  

0

Share Via Email

For representational purposes

HYDERABAD: Goods and Services Tax (GST) is often confusing for new home buyers as builders quote different rates for under construction projects. Some builders are even demanding GST for completed projects having occupancy certificate (OC) — a case where it is not applicable.

According to the GST Council, different tax rates are applicable to various materials and services used during construction. It leads to builders paying different GST amount from project to project. As builders are eventually transferring the GST burden on to home buyers, it is essential for the people to know what should be kept in mind while buying a new home.

“Different GST rates are applicable on different construction materials. Cement is charged 28 per cent, works contract 18 per cent and building bricks 5 per cent. As the GST varies from item to item and also from location to location, builders are calculating the whole amount and charging buyers. These variations are adding to the confusion,” says Gummi Ram Reddy, president, CREDAI’s Telangana unit.

“It is difficult to come up with a uniform rate. Therefore, the best way for a buyer is to inquire about each project separately and find out how much GST amount is being incurred so that they don’t end up paying more.”

According to the GST Council, new under construction homes are defined as a complex, building, civil structure or a part thereof, intended for sale to a buyer, wholly or partly (the value of land is deemed to be one-third of the total amount charged for such supplies) and the rate is fixed at 12 per cent. But,
realtors are quoting rates ranging from 6 to 12 per cent to the prospective buyers.

“Builders are charging different GST rates depending upon market conditions prevailing in cities and project locations. While some builders are paying GST  thmeselves and absorbing the amount into the final sale price, some are directly transferring the GST burden on home buyers,” asserts Samantak Das, Chief Economist and National Director-Research, Knight Frank India.

“Therefore, buyers should ask a builder whether the price quoted is including or excluding the GST. If it is excluding the GST, then they should ask the builder as to how much input credit will be reimbursed to them after the GST payment. They should demand reimbursement of the input tax credit, which home buyers are entitled to.”

Buyers can take advantage of completed projects which have got Occupancy Certificate (OC), for avoiding the GST.

“There is no GST on completed projects which already have Occupancy Certificate. Therefore, when a builder quotes GST on a completed project, then a home buyer should ask him whether the project has got an Occupancy Certificate or not,” says K Sreedhar Reddy, treasurer, Telangana Real Estate Developers Association (TREDA). “If it has got an OC, then GST should not be paid.”

Stay up to date on all the latest Business news with The New Indian Express App. Download now
TAGS
Goods and Services Tax GST

O
P
E
N

More from this section
State-owned Air India is staying afloat on taxpayers' money and has been in the red for long.

After Swadeshi Jagran Manch, Bharatiya Mazdoor Sangh too opposes Air India disinvestment 

Punjab National Bank claims expected recovery of Rs 1,800 crore from 'Mission Gandhigiri'

Bond yields spike after RBI panel meeting minutes flag inflation risks

Latest

Former Delhi HC Chief Justice Rajinder Sachar passes away 

FIR against BJP MLA for 'Hindu vs Muslim' remark during Karnataka rally

11-year-old girl raped, killed in Chhattisgarh

2G scam: Essar Group's response sought on plea against acquittal

UP: Boy dies after govt hospital refuses treatment

Alabama executes 83-yr-old pipe bomb killer

Seize Dawood Ibrahim's Mumbai properties: SC

Jim Bridenstine is new NASA chief

IPL2018
Videos
CM Chandrababu Naidu sits on 12-hour fast on his birthday demanding SCS for Andhra Pradesh
Home Minister Rajnath Singh (File | PTI)
There has always been an attempt to malign BJP's image: Rajnath Singh
arrow
Gallery
Ola co-founder Bhavish Aggarwal, Bollywood actress Deepika Padukone, Indian cricket captain Virat Kohli and Microsoft's Indian-born CEO Satya Nadella have been named in TIME magazine's 100 most influential people in the world this year, an annual list of honorees that includes US President Donald Trump. 'TIME's annual list of the world's most influential people is a designation of individuals whose time, in our estimation, is now,' the magazine said.
TIME magazine’s 100 most influential people: From Virat Kohli to Deepika Padukone, these Indians featured on the list
Ghostbox Cowboy: What happens when a Texan businessman lands in China's Silicon Valley? This film by John Maringouin describes the character's (Jimmy Van Horn played by David Zellner) experience in Shenzhen, a city which was once a simple fishing village. (Photo | Tribecca official website)
Tribecca Film Festival: Here are 10 films with intriguing titles from the diverse lineup
arrow

Trending

FOLLOW US

Copyright - newindianexpress.com 2018

Dinamani | Kannada Prabha | Samakalika Malayalam | Malayalam Vaarika | Indulgexpress | Edex Live | Cinema Express | Event Xpress

Contact Us | About Us | Careers | Privacy Policy | Search | Terms of Use | Advertise With Us

Home | Nation | World | Cities | Business | Columns | Entertainment | Sport | Magazine | The Sunday Standard