If you are buying a ready to move-in house, you don’t need to pay goods and services tax (GST) if the sale takes place after the completion certificate has been issued, the finance ministry said on Saturday. GST would, however, be applicable for under-construction buildings and for ready to move-in flats that haven’t got the completion certificate at the time of sale.
While issuing this clarification on Saturday, the finance ministry also asked builders to reduce the prices of properties by passing on the benefit of lower GST rate. It also sought to dispel the notion that the cost of housing projects has gone up due to the GST rollout.
While affordable housing projects such as Jawaharlal Nehru National Urban Renewal Mission, Rajiv Awas Yojana, Pradhan Mantri Awas Yojana etc attract eight per cent GST, builders can offset this against input tax credit, it added.“For such (affordable housing) projects, after offsetting input tax credit, the builder or developer in most cases will not be required to pay GST in cash as the builder would have enough ITC in his books of account to pay the output GST,” the ministry said.