A builder has two scenario
1. He owns land (land held as stock) builds flats in it. He make separate land sale agreement and builders agreement. Is gst 5% payable also on land sale value as same will be reported as part of turnover?
2. Is only a power holder of land. Builds and sells flats. Sale of land is made as separate agreement. Collects and pays full to owner/retains marginal Amt in the land value. Wat is liability.
Is it like 7.5% gst rate and 1/3rd adjusted for land so its 5% payable without itc?
GST Implications for Builders: Land Ownership vs. Power Holder Roles, Tax Rates, and ITC Restrictions Explained A builder inquires about GST implications in two scenarios: owning land versus being a power holder. In the first scenario, where the builder owns the land, GST is applicable at 7.5% with a 1/3rd deduction, resulting in a 5% net rate. In the second scenario, where the builder is a power holder, the taxable value is 2/3rd of the sale value at a 7.5% rate, including land value. The nature of the contract, such as a developer agreement or transfer of rights, influences the tax liability. No Input Tax Credit (ITC) is available for projects initiated after April 1, 2019. (AI Summary)
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