Service tax applicability on construction of residential com

Dear sir,

in our case one of our client ( engineering contractors)purchase land for construction of residential complex. then he sell undivided portion in land along with the right to construct each apartment to each buyers. each buyer enters into an agreement with our client (i.e. seller of undivided share land) to construct the residential building. what will be the service tax applicability & exemptions under new regime. our client is a private limited company.can you please help me friends ?

Replies (1)

The service provided by your client is liable to service tax. 40% of the gross amount received from customers is the value of service. Tax is 12.36% of this amount. Alternatively, if land value is included in the gross amount , then you can opt abatement. Under this method 25% gross amount inclusive of land value is the value of service.

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