No GST on flats with issue of completion certificate: Finance Ministry

GST, goods and services taxThe finance ministry Saturday said GST will not be levied on buyers of real estate properties for which completion certificate is issued at the time of sale.However, Goods and Services Tax (GST) is applicable on sale of under-construction property or ready to move in flats where completion certificate is not issued at the time of sale, it said.The ministry also asked the builders to reduce the prices of properties by passing on the benefit of lower GST rate.ALSO READ: Get real on GST“It is brought to the notice of buyers of constructed property that there is no GST on sale of complex/ building and ready to move in flats where sale takes place after issue of completion certificate by the competent authority,” the ministry said in a statement.It further said affordable housing projects like Jawaharlal Nehru National Urban Renewal Mission, Rajiv Awas Yojana, Pradhan Mantri Awas Yojana or any other housing scheme of state governments attracts 8 per cent GST, which can be adjusted by the builders against its accumulated input tax credit (ITC).ALSO READ: Indirect tax dept extends annual GST returns filing date to March 31, 2019“For such (affordable housing) projects, after offsetting ITC, 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. ?ALSO READ: After traders request, GST return filing date extended to March 31, 2019“Builders are also required to pass on the benefits of lower tax burden to the buyers of property by way of reduced prices/ installments, where effective tax rate has been down, it said.
Source: Business Standard