Real estate is one of the most significant pillars of our country’s economy. Under the previous tax regime, several taxes such as registration charges, stamp duty, service tax, and VAT were paid by the buyers. But currently, house buyers are required to pay GST on property purchase among many other taxes. But, is GST applicable on resale flat? Read below to know:GST on Resale FlatAs per the latest GST tax structure, any residential project that has obtained a completion certificate, or any ready-to-move-in property can’t be classified as a service. This is why the GST rate is not applicable in such cases. So, in the case of resale of such properties, there will be no GST levied. However, registration charges and Stamp duty will be a separate component.What is a Completion Certificate?If I talk about under-construction properties, then such projects come under works contract and this is why they are classified as a service. In these cases, a single rate of 12% is applicable. The first buyer is required to pay the applicable GST to the developer and won’t be applicable in the case of a resale of properties. Again, registration charges and stamp duty will be separate.Read more:What is affordable housing as per GST?How to calculate GST on flat purchase 2021?How much gst on home loan is applicable?How to calculate stamp duty and registration charges?I hope you like my answer to the “do you have to pay GST on a resale home” query.
The Indian economy relies heavily on real estate. Previously, buyers were responsible for paying taxes such as VAT, service tax, stamp duty, and registration fees. However, under GST, under-construction properties are subject to a single rate of 12 percent, whereas completed or ready-to-sell properties are exempt from GST if a Completion Certificate (CC) has been obtained. So let’s see the stamp duty on resale flat.
GST on stamp duty and resale flat registration charges:
The Indian Stamp Act, 1899, specifies that all parties engaged in the transaction must pay stamp duty on sale documents. As a result, a sale deed must be registered, whether it is for an under-construction home, a ready-to-move-in flat, or a flat on the secondary market. As a result, you as a buyer must pay the necessary stamp duty and registration fees in his state, regardless of whether the property is new or old, as long as a sale deed is signed.If you buy a property in Mumbai that will be ready in 2 years, you will pay 2% stamp duty and 1% registration fee. If you acquire a house on the secondary market, the fees stay the same. The same can be said about builder-supplied ready-to-move-in flats.
GST on resale property:
In concepts of the Goods and Services Tax, resale property buyers get a tax break (GST). Because, unlike under-construction dwellings, a ready-to-move-in flat is not subject to a work contract, the buyer is not charged GST for resale flat at the time of purchase.
While purchasing a new property, you not only need to pay a huge amount on buying a flat but you also need to pay a lump sum amount on GST. But the most important question we should ask is GST on resale of flat applicable. I will try to answer this and solve your doubt in a simplified manner. Hire expert lawyers at NoBroker and be stress free about land disputes
Is GST applicable for resale flat?
Buyers purchasing a resale flat do not need to pay tax under Goods and Services tax (GST). Since the flat is a ready-to-move-in condition unlike other under-constructed flats and does not fall under the scope of a work contract, a buyer is not liable to pay GST at the time of purchase. But if a buyer is purchasing a property from the developer who has paid the GST during the construction work then the buyer has to pay the GST amount before buying the flat. So, what is the resale flat GST rate? As per the recommendation of the GST Council 18 % tax should be levied on buyers for building construction. However, for an under-construction property, the rate would be 12%. I hope I was able to clear the doubt regarding ‘Is GST applicable on resale property?’I hope you find this answer on GST on resale of flat informative.Read more:How to Calculate GST on Sale of Land?How the GST is calculated on underconstrcted flatHow to calculate interest on late payment of GST ?
You must pay the Goods and Service Tax, or GST when purchasing a residence. Real estate buyers and developers are impacted by the GST. The Tax on real estate in India varies depending on the type, price, stage of construction, and other factors. However, if you are wondering whether, Is GST applicable on resale of flat, then I’d say that, there is no resale flat GST charges. The "Occupation Certificate" indicates that the building work has been finished and there is no service component to the transaction, hence GST is also not applicable in this case.Buy property in your locality from genuine and verified sellers through NoBroker and save lakhs on brokerageGet expert legal assistance service for property document verification from NoBrokerI hope this clarifies your query about whether Is GST applicable on purchase of old house?In India, buyers of under-construction flats, apartments, and bungalows pay 1% GST for housing that is cheap and 5% GST for housing that is not. Purchases of real estate land are subject to the GST. In 2023, buyers of flats and apartments in developments that are still under construction in India's megacities will have to pay GST. It should be noted that purchasing apartments in completed developments is not subject to the GST.GST on resale flat without OC:You must pay GST if you purchased a single residential property prior to receiving the completion certificate from the appropriate authority. You are exempt from paying GST if the seller received the completion certificate prior to the agreement.I’d like to conclude my discussion here about whether Is GST applicable on resale of flat. I hope this helps:)Read More:How to Calculate GST on Flat Purchase?Is GST Applicable For Ready To Move In Flats?How the GST is calculated on under-construction flat?
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Is GST applicable on resale flat?
Kiran
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September 28, 2021
2021-09-28T17:13:33+00:00 2023-10-18T18:16:33+00:00Comment
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Resale Property
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