Q:80% of construction completed.The builder is charging the VAT (5.5%) and Service tax (3.09%) on the total cost of the project ( Basic cost+ Car parking+ Amenities) - is this correct?
Latest Answer: As per the rules, from June 1st, 2015, Service Tax for an under-construction flat will be calculated at the rate of 14 % of the gross value of the property. But as there is a Government abatement of 75 percent (increased from 67 percent), tax will be levied only on 25 percent of the gross value of the property. The effective rate of service tax is therefore 3.5%.
For example,
The basic square feet price of your 1200 Sq Ft flat is Rs 4000 with PLC of Rs 100.
Car Parking Charges = 3,00,000
Service Tax = [{(1200 X 4000) + 3,00,000} X .035] + [(1200 X 100) X 0.14] = Rs. 1,95,300
VAT differs from state to state. In your state if the VAT is 5%, you can extend that your flats construction material cost. All you need to do is ask your builder for the construction material cost of your unit and apply 5% on it and you will get a figure.
For Example
Construction Material Cost of your unit is Rs. 30,00,000
VAT = 30,00,000 X .05 = Rs. 1,50,000
Q:I have booked a flat in reliance residency in ambernath -e.do i have to pay vat and service tax? if so, then how much?it is not clear to me whether to pay cash or cheque.
hemant.
reliance residency palle village, near shiv mandir, ambernath -e
Latest Answer: HI all,
It i not true. As usual the tax initiative is finally falling on the buyers who will be taxed eventhough it sounds as a direct take from builders.Why is the Govt so not transparent abou this and what does make them play different ways of answering a simple taxation which needs a question answer way to be dealt
