Service tax & vat on construction property

Ashok kadam,

11th March 2016

Property Tax in Meena Regency, Chakan, Pune

service tax & vat on constructed property

vat & service tax in pune

vat & service tax for under construction property

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Replies (1)

HI Ashok,
In budget 2015-16, it was proposed that a home buyer will pay a service tax of 14% while buying a property that is under construction instead of the current 12.36%. It is not charged on the entire value of the property but only to the extent of cost of construction. This means that cost of land is excluded.

ujwal nikam, Pune

14th March 2016

Comment

Yes, and VAT is charged at the rate of 1% of ''agreement value'' in Mumbai and Pune.

For the purpose of calculation, 25% of the gross value of an under-construction unit with value less than Rs.1 crore is considered to be the cost of construction, and service tax is applied on this. Properties valuing more than Rs.1 crore attract service tax of 30% of the gross value.

Dayananda, Mumbai

14th March 2016