Are there real estate taxes in India?

The effective rate of Service Tax on property is 3.75% or 4.5% depending on the size of the property and the transaction value. Service Tax on sale of property is required to be paid by all taxpayers irrespective of the state in which the property is situated.

Is GST applicable on real estate sector?

Under GST, a single tax rate of 12% is applicable on properties under construction while GST is not applicable on completed or ready to sale properties which was the case in previous law. Hence buyers will benefit from reduction of prices under GST.

What is property service tax?

Computation of Service Tax on Under Construction Property So Service Tax @ 15% on 25% of the Total Purchase price is levied on under Construction Property. In other words Service Tax @ 3.75% (25% of 15%) is levied on the total price paid for the purchase of an under construction property.

Is service tax applicable for residential property?

There is no service tax charged on renting of immovable property for residential purpose. Service tax is not applicable to any amount that is refundable and collected from the tenant as security or rental deposit. Maintenance charge towards the building is subject to service tax.

What is the tax on selling property in India?

Long term Capital Gains on sale of real estate are taxed at 20%, plus a cess of 3%, if the sale fulfils certain conditions. If you sell a property that was gifted to you, or that you have inherited, you will still be liable to pay capital gains tax on it.

Who pays GST on real estate?

Flat owners are liable to pay 18% GST on residential property, if they pay at least Rs 7,500 as maintenance charge to their housing society. Housing societies or residents’ welfare associations (RWAs) that collect Rs 7,500 per month per flat, also have to pay 18% tax on the entire amount.

Who pays GST builder or buyer?

4.5% of Service Tax is applicable on the invoices raised or consideration paid before the 15 July, 2017. However, payment made by the buyer to the builder on or after 1st July, 2017 against invoices issued on or after 18 July, 2017 shall attract GST @ 12%.

Who will pay service tax builder or buyer?

The 2010-11 budget imposed service tax on all under-construction properties from July 1, 2010. Now, according to the Service Tax Act [Section 65(105)], the developer or builder of an under-construction property has to pay service tax when he sells a property to a buyer.

Who is the chairperson of GST?

Arun Jaitley
It consists of the following members: The Union Finance Minister, Arun Jaitley will be the Chairperson.

What is the service tax rate for real estate?

Service Tax needs to be paid at full rate of 12.36% as no abatement is available on such amounts. Across the country, divergent business models and practices are being followed in the real estate sector. Some of these business models and service tax applicability on these models are discussed as below:

What is the present rate of service tax in India?

At present, the service tax levy extends to whole of India except the state of Jammu and Kashmir. The present rate of Service Tax is 12.36%, consisting of Service Tax 12%, Education Cess 2% and Secondary Education Cess 1% thereon. However in certain cases abatements are available as mentioned here-in-after.

Is there taxability of transactions in real estate sector?

Herein, I have tried to pen down taxability of various transactions in real estate sector. A. Income Tax (All section refer herein relates to Income Tax Act, 1961):