You need to pay GST on 5 flats.
GST on landowner retained flats
Hello experts,We entered into JDA with a builder.My father is the lone owner of the land and we are two brothers.My father will be receiving 5 flats after the construction is complete.We plan to keep 3 flats for our own residential purpose and sell 2 flats after Completion Certificate is obtained. Will we need to pay GST to the builder on all the 5 flats or 2 flats we plan to sale after completion on the day we get possession/allotment letter is issued to my father?
Asked 7 years ago in GST
GST will need to be paid on all the 5 flats.
Regards,
Nikhil.
GST to be payable on all 5 flats .
Hi,
GST will be levied on all the 5 flats. Further, when you sale two flats post completion of flats, no GST will be applicable to you.
Please feel free to call/ revert in in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
Thanks for the clarification experts. Now some more doubts I have 1.What value of these 5 flats must be taken into consideration for GST calculation? 2.What is the GST rate that will be considered,8%,12% or 18%? 3.Will we get advantage Input tax Credit of builder paying the GST amount on raw materials for consideration,I mean will that lower the GST burden to be paid by builder for our share of 5 flats? Please reply sir.Thanks.
Asked 7 years ago
1. GST will be paid on the share of cost borne by you. Builder will raise tax invoice to you.
2. Rate will be 12%.
3. Builder will get benefit of ITC on raw material.
Hi,
Please find the answer to ypur queries:
1. The value of the flats would be the share of your cost for these 5 flats.
2.12%
3. Yes the builder will get the benefit of input credit and so the burden of GST should reduce.
Hope that clarifies.
Regards,
Nikhil.
Thanks for the response sir,can you please clarify what do you mean by "the share of cost borne by you". We have no investment in this JDA we have given our land and in exchange we will be getting 5 flats. We do not have anything else as cost borne by us.
Asked 7 years ago
Dear Sir,
As a landowner you need to register under GST and pay tax@18% on your share of flats.rate is 18% not 12%.
Thanks
In that case the proportionate cost of construction of the flats will be used to compute the GST.
Regards,
Nikhil.
1. Value will be the fair market value.
2. GST will be 12
3. No, you want get any direct benefit of ITC.
Please feel free to call/ revert in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
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