Q:Dear Sirs,Suppose I sell a residential flat in 2013 for Rs 1.62 cr approx. (going market rate) which was purchased in 1985 - 1986 for Rs 2.55 lacs:1) What is the VAT / Service tax / TDS tax / any other tax me / buyer will have to bear / pay (if any)? It seems some new rule is come into effect from June 01, 2013 regarding service tax. I request clarification.2) What is the long term capital gain tax I have to pay on sale of the flat?Likewise, if I invest the proceeds of sale in part or full in purchase of residential flat (new / resale) what will be my tax outgo (VAT / Service tax / TDS tax etc)Thanks,Shivakumar R Sharmaemail:shivakumar_sharma@yahoo.co.in
Latest Answer: i all,
To give buyers relief, the government has allowed income tax deductions if the property is bought on a loan. Under Section 80C, the borrower can claim deduction of up to Rs 1.5 lakh. For a self-occupied property, a Rs 2 lakh benefit is available under Section 24 (b) of the Income Tax Act for interest on the home loan. If the property is not self-occupied, the entire interest paid to the lender can be deducted from income.
Q:Is this correct that all the buyers who bought under construction property between Jun 2006 to March 2010, will have to pay 5% VAT on agreement value plus an interest of 15% per annum?
Latest Answer: Thing to remember while you are buying property:- 1) VAT and Service Tax are not applicable on ready-to-move-in properties. For instance, if you have bought a property when it is almost ready-for possession, you must consider to postpone your sale agreement to be signed after completion certificate is issued. If you do so, then you will be saved from paying these charges.
2)Builder has to issue 2 separate payment receipts i.e. one each for VAT (with Tax Invoice no and TIN) and Service Tax (with Tax Invoice No and ST registration no).
3) Service Tax is not applicable on single residential unit i.e. independent house, villa or bungalow.
4) Service Tax is not applicable for low cost housing with carpet area of up to 60 sq-mt.
