Question ID :
40683
GST RATE FOR BUILDERS OF INDIVIDUAL RESIDENTIAL HOUSES
What is the GST rate for construction of Individual residential houses in client's land.
Whether new GST rate of 1% in case of construction of affordable houses and 5% on construction of houses other than affordable house, is applicable for them.
Posted by
HARIPRASAD M
on
Jun 13, 2020
Filed Under
GST
with effect from 1st April, 2019, builders have been given choice to opt for GST rate of 1% (affordable house) and 5% (other than affordable house) provided:
- No Input credit is taken
- 80% of the procurement is done from registered dealers.
- Any short of 80% procurement, need to be paid at the rate of 18%
-Cement procured from unregistered dealer would attract 28%.
Or else
charge 8% (affordable) and 12% ( non-affordable) and take input credit.
In your case, it is not clarified if a person is making residential house for its own residential purpose. or he/she has a business of building.
We need to evaluate first whether it is a supply, if the owner of the land is making house for its own residential purpose and do not have any business of construction. As this will not be in furtherance of the business and will not fall under the definition of Supply.
Posted by
CA Yogesh Kumar on
Jun 14, 2020
Answer ID :
80572
Sr. No 11 of Notification No 12/2017 provides an exemption for Services by way of pure labour contracts of construction, erection, commissioning, or installation of original works pertaining to a single residential unit otherwise than
as a part of a residential complex.
If i have understood it correctly, any service provided by a contractor for construction of individual house then it will fall under the ambit of the above exemption.
Hope this will be helpful
Posted by
SACHIN AGARWAL on
Jun 23, 2020