One of the condition for Real Estate Projects under New Tax scheme is 80 % of Value of Inputs and Input Services should be received from Registered Supplier. My question is every one is considering 80 % of value inputs only they are ignoring Input Service Portion. But in Real estate /Builders around 40-50% of investment is Labour portion. Give me advice whether such labour portion is as part of Input serivce as mention above condition or not. If yes then when reconciliation to me made monthly/ yearly.
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Clarification regarding Conditions applicable for Builders under New Tax Scheme
Replies (1)
As per Notification 7/2019 CT(r) ,read with Notification 3/2019 CT(r) , 80% of procurement of Input & Input Services shall be from Registered dealer .Input services do not includes ,:
value of services by way of grant of development Right, value of electricity, diesel, motor spirit & natural gas used in construction.
So to computing the threshold limit of 80% the investment in labour portion is included.
Note : For procurement of capital goods there is no such limit is prescribed hence in case of Capital goods , 100% purchase is to be made from Registered dealer & As per Notification 24/2019 CT(R) dated 30/9/2019 , purchase of Cement also be done 100% from Registered dealer.
The Promotor shall prepare proper record for Inward supply from Registered & Unregistered dealer & Calculate the tax payment on the shortfall at end of Fy ( End of QTR. following FY , not later than the month of June following FY)
value of services by way of grant of development Right, value of electricity, diesel, motor spirit & natural gas used in construction.
So to computing the threshold limit of 80% the investment in labour portion is included.
Note : For procurement of capital goods there is no such limit is prescribed hence in case of Capital goods , 100% purchase is to be made from Registered dealer & As per Notification 24/2019 CT(R) dated 30/9/2019 , purchase of Cement also be done 100% from Registered dealer.
The Promotor shall prepare proper record for Inward supply from Registered & Unregistered dealer & Calculate the tax payment on the shortfall at end of Fy ( End of QTR. following FY , not later than the month of June following FY)
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