• Who will pay the 12% GST to govt.

In case of JV agreement, GST is applicable both on land owner and builder. Builder will be liable to pay GST @18% on the construction amount of the flats. Landowner will be liable to pay GST@12% on his share of flats. 
But who will collect this GST of land owners share , will land owner pay himself or its duty of builder to collect the landowners GST amount and then pay to the Govt.
If builder will collect the GST from land owner can this be adjusted with ITC paid for construction ...?
Asked 2 years ago in Income Tax

Hi

- Landowner needs to register himself.

- Yes GST charged by the builder can be claimed as ITC.

 

Thanks

Vivek Kumar Arora
CA, Delhi
4063 Answers
338 Consultations

5.0 on 5.0

Hi,

Hope you are doing well !!

 

The primary liability to pay GST on landlord share of constructed area is on the supplier of service namely the developer. However as GST is a destination based levy to be borne by consumer, the developer could collect from landlord and pay GST to Govt especially when there is specific clause in JDA that tax such as GST to be paid extra by landowner to developer.

 

Yes, it can be adjusted with ITC paid for construction.

 

Thanks & Regards,

Payal Chhajed

Payal Chhajed
CA, Mumbai
5077 Answers
152 Consultations

5.0 on 5.0

Hi,

 

The Landowner needs to registered for GST. 

Builder is liable to charge GST and collect the same and then pay to the govt.

Yes, GST charged by builder can be adjusted with ITC paid for construction.

Karishma Chhajer
CA, Jodhpur
2387 Answers
20 Consultations

5.0 on 5.0

Hi,

 

The landowner will himself need to register for GST. GST charged by the builder can be claimed as ITC.

 

Regards,

Nikhil.

 

Nikhil Khanna
CA, Mumbai
1428 Answers
19 Consultations

4.8 on 5.0

You are getting confused.. builder will be liable to pay 12% GST on this construction, the rate is 18% but 1/3rd is deemed as land value so GST rate is 12% and he is constructing home for land owner also so he will collect it from land owner and pay to government. This is the normal way of doing it. Builder is the service provider and land owner is the receiver of service.

 

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

Naman Maloo
CA, Jaipur
3791 Answers
45 Consultations

5.0 on 5.0

Hi,

It should be levied on the value of the construction of the property.

GST is not applicable on value of land.

Payal Chhajed
CA, Mumbai
5077 Answers
152 Consultations

5.0 on 5.0

Dear Sir

 

The landowner Has to register under GST Regime and Collect & Pay GST to the government(s) & he can adjust the amount of GST output with the Input he has.

Shiv Kumar Agarwal
CA, Delhi
475 Answers
74 Consultations

5.0 on 5.0

- Builder will collect GST on the total construction cost and landowner will collect on his share received from the builder. Builder will charge 18% of total value as he is not the owner of land whereas landowner will charge 12% of total value. For landowner, GST paid on the cost of construction for his share to the builder will be ITC.

 

Vivek Kumar Arora
CA, Delhi
4063 Answers
338 Consultations

5.0 on 5.0

GST is to be paid on the amount received by builder in JDA case since the builder received land ownership he will pay GST @12% on the FMV of value of land received.

Naman Maloo
CA, Jaipur
3791 Answers
45 Consultations

5.0 on 5.0

12% will be calculated on circle rates or rates arrived on valuation of property.

Chirag Maru
CA, Raipur
203 Answers

5.0 on 5.0

Landowner is liable to pay 12% of his share of constructed area's value.

 

The valuation of constructed area of Landlord share to be determined from perspective of the service recipient landlord by following methods:


1. Open Market Value

 

2.Value of services of like kind or quality


3. Valuation of property

 

4.Cost plus mark up.

 

Karishma Chhajer
CA, Jodhpur
2387 Answers
20 Consultations

5.0 on 5.0

Hi

 

Builder has to pay GST to govt, ITC can be cliamed here.

GST to be collected on total construction cost by builder.

Swati Agrawal
CA, Mumbai
1146 Answers
7 Consultations

5.0 on 5.0

Ask a Chartered Accountant

Get tax answers from top-rated CAs in 1 hour. It's quick, easy, and anonymous!
  Ask a CA