GST ON FLAT REGISTRY BY HOUSING SOCIETIES
This query is : Resolved
04 October 2020
If a housing society constructs flats after receiving payments from its members and registers the flats in their names after completion. Will it attract GST? If so, what would be the point of taxation? Periodic payments or registry date.
04 October 2020
Yes, it will be subject to GST.The point of taxation will be receipt of payment or invoicing which ever is earlier.
04 October 2020
Dear Mr. Sood, thanks for your reply but could you please clarify the reason for levy? Since I need to know the basis because of which GST is leviable on sale of flats on cost to its members without profit motive to convince others in society.
04 October 2020
construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer is a supply of service and hence, is liable to the goods and services tax (GST). This is works contract service under GST. However, no GST is meant to be paid on ready to move in or completed property as per the CGST Act, 2017.
Refer Schedule II of the CGST Act.
Refer Schedule II of the CGST Act.
04 October 2020
But will the housing society's work come under the definition of business? Since the business definition for Co operative societies mainly talks about facilities and benefits provided by the NPO to its members. But if a society constructs flats for its own members from its members capital, will that be covered in installments and business definition of GST?
04 October 2020
1. In the definition of business in GST, profit motive is not essential.
2. The society is engaged in providing the services of upkeep and facilities to its members. So the construction of houses for its members FOR CONSIDERATION will get covered in the definition of business.
2. The society is engaged in providing the services of upkeep and facilities to its members. So the construction of houses for its members FOR CONSIDERATION will get covered in the definition of business.
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