VAT and Service tax rate on purchasing a flat in bangalore

Q: Dear One

I am purchasing a ready to move flat in Bangalore worth Rs.3500000/-(Near Kempapura, Hebbal) kindly help me in understanding to know at what rate and on what amount the VAT and service taxes are charged.

Also, i learnt that, if the construction is completed, there is no need of paying any VAT and service tax by the buyers. Am i correct, if not please correct me and assist me with providing detailed information about VAT and service Tax on purchasing a flat in bangalore

sandesh jakka,

8th May 2015

Buying property in Hebbal Kempapura, Bangalore

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Replies (3)

When you buy a house, you pay for two components:

1) Value of land
2) Construction offered by the developer (service provider)

Service tax is payable only in case of construction services and not on the value of land. In cases where it becomes difficult to ascertain cost of immovable property and service cost separately, government has come up with the provision of abatement scheme where an amount is levied on the total amount.

Sreya Khan, Bangalore

8th May 2015

Comment

Hi Sandesh, VAT and service tax is only paid for under construction apartment.

For example: if the cost of a property, 1500 sq.feet large, is 40,00,000, then the service factor value becomes 12.36%*40,00,000 and the total service tax becomes 25% of the service factor value (.25*.1236*40,00,000= 1,23,600)

Venugopalan, Bangalore

8th May 2015

Comment

If the flat is ready to move and builder got OC/CC then no need to pay any service tax and VAT

Raghavendra, Apartment Resident

8th May 2015

Comment

Builder got CC but not OC. In this case what is the status. If VAT & Service Tax is payable then on what value? i.e agreement value or index value which Govt charge stamp duty & registration.....

Mahesh Desai,

27th August 2015

You need not have to pay service tax and VAT for a ready to move in property.

Venugopalan, Bangalore

9th September 2015