GST for individual house construction

[Preeti Preeti]

I have to construct residential house in my plot, I am hiering an construction company( architectural plan +materials+construction)

Can anybody clarify about for what and all should I pay the GST for, and should I pay the double times GST to the construction company for materials as they would have already paid while purchasing from shop...

[Alkesh Jani]

Sir/Madam, in terms of Sl.No. (v) (b) of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 as amended by Notification No. 20/2017-Central Tax (Rate) dated 22.08.2017 & notification no.24/2017-Central Tax (Rate) dated 21.09.2017, 12 % GST (i.e. 6% CGST + 6% SGST) is applicable. Our experts are requested to correct me if mistaken.

[Padmanathan KV]

the tax rate will be 18% as the contractor does not include land cost in the contract value. therefore 1/3 abatement for land will not be allowed. in case you are purchasing and supplying all materials and the contract is for labour supply only, then it is exempt supply. if the contractor purchases the materials, he can take ITC claim.

AI Summary

GST on house construction: tax treatment depends on inclusion of land and whether contract is labour-only or includes materials. GST on residential house construction hinges on contract composition: if the contract excludes land value, abatement for land is not allowed and the service attracts the standard contractor tax rate; if the owner supplies materials and the contract is for labour only, the supply is exempt. Where the contractor purchases materials, the supply is taxable and the contractor can claim Input Tax Credit.