REAL ESTATE SECTOR

[SK Krishna]

Hello sirs/madam,

Whether RCM CREDIT could be availed under new scheme / condition of tax rates (1% or 5%) for REP projects without ITC applicable from 01.04.2019?? Whether ITC & RCM credit are different in this scenario??

Kindly clarify. Thank you.

[Shilpi Jain]

Where the condition in the statute is that ITC is not available then the credit of taxes paid under RCM will also not be available

[Ganeshan Kalyani]

Sir, under new scheme of real estate project the input tax credit is not allowed. Input tax credit includes credit on inward supplies other than RCM and inward supplies under RCM.

AI Summary

Input Tax Credit exclusion under real estate composition scheme bars claiming reverse charge credit for REP projects. Where the statutory scheme for real estate projects disallows Input Tax Credit, credit for taxes paid under the Reverse Charge Mechanism is also not available because RCM credits form part of the input tax credit regime; thus developers subject to the scheme cannot separately claim RCM credit for inward supplies.