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Ongoing realty projects in state get a breather

Date: 17-05-2019
Subject: Ongoing realty projects in state get a breather
Ahmedabad: In a major relief to real estate developers, State Commercial Tax Department has extended the deadline for adopting old Goods and Service tax (GST) rates for under-construction housing projects. The deadline for declaration in the form of Annexure-IV has been extended to May 20 from May 10 previously.

In March, the GST Council had reduced tax rates on residential real estate properties from 12% with input tax credit (ITC) to 5% without ITC. 

For affordable housing projects, the rate was brought down to 1% without ITC from 8% with ITC. New real estate projects starting after April 1, 2019, now attract 1% GST in affordable category and 5% in the non-affordable category. However, for ongoing residential projects, the developers were given an option to choose either the new tax rates or continue charging the old rates of GST.

“Those willing to opt for the older tax structure must fill in Annexure-IV form under GST and declare it to the jurisdictional commissioner at the respective unit offices,” said Ajay Kumar, special commissioner, state commercial tax department.

According to an official statement from state commercial tax department, the declaration to the jurisdictional commissioner were to be made till May 10, 2019. The deadline has been extended till May 20, 2019.

State commercial tax department officials also confirmed that developers can submit the declaration before the respective jurisdictional commissioners at the unit offices. 

The jurisdiction would be decided based on the registered office of the developer. It is not mandatory to submit the declaration before the chief commissioner at the state commercial tax office.

Even as the GST council has revised the definition of affordable housing, this definition will be applicable only to new real estate projects launched from April 1 and not the ongoing ones. According to the new definition, any house with a value upto Rs 45 lakh and having a carpet area of 60 square metre in non-metro cities and 90-square metre in metro cities would be classified as an affordable house.

Source: timesofindia.indiatimes.com

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