12 May 2012
can anyone tell me plz whole updated provisions of service tax related to residential constuction service , commercial construction service , club membership service , preferntial location service ?
20 July 2024
As of my last update, the provisions related to service tax have transitioned into Goods and Services Tax (GST) in India. GST has subsumed various indirect taxes including service tax. Here’s a brief overview of how these services were treated under the service tax regime, and their general treatment under GST:
### 1. Residential Construction Service:
- **Service Tax (Previous Regime)**: - Residential construction services were liable to service tax under the category of "construction of complex, building, civil structure, or part thereof, intended for sale to a buyer, wholly or partly." - The effective rate of service tax varied depending on abatement rates and exemptions applicable.
- **GST (Current Regime)**: - Under GST, construction of residential complexes is treated as supply of services. It is taxed under the category of "construction services" and is generally subject to GST at applicable rates (currently 5% for affordable housing and 18% for other residential housing).
### 2. Commercial Construction Service:
- **Service Tax**: - Similar to residential construction, commercial construction services were subject to service tax under the same category of "construction of complex, building, civil structure, or part thereof."
- **GST**: - Under GST, construction of commercial complexes is treated as supply of services. It is subject to GST at applicable rates (18%).
### 3. Club Membership Service:
- **Service Tax**: - Club membership fees were subject to service tax under the category of "club or association services." - The effective rate of service tax was applicable to the consideration received for such memberships.
- **GST**: - Under GST, membership fees for clubs are taxable under the category of "services not elsewhere classified" and are subject to GST at applicable rates (18%).
### 4. Preferential Location Service:
- **Service Tax**: - Preferential location charges (PLC) were treated as part of the taxable value for service tax purposes in real estate transactions. - PLCs were subject to service tax under the construction or real estate services category.
- **GST**: - Under GST, PLCs are treated as part of the consideration for the supply of construction services and are subject to GST at applicable rates (18%).
### Important Notes under GST:
- **Input Tax Credit (ITC)**: - GST allows builders and developers to claim input tax credit (ITC) on goods and services used in construction against output GST liabilities. This helps in reducing the overall tax burden.
- **Compliance Requirements**: - Builders and developers need to comply with GST regulations including registration, invoicing, filing of returns, and payment of GST on a timely basis.
- **Transitional Provisions**: - Transitional provisions were provided to facilitate the transition from service tax to GST, including treatment of ongoing contracts and credits under the previous regime.
### Conclusion:
For precise and updated provisions, it’s advisable to refer to the latest GST laws, notifications, and circulars issued by the GST authorities in India. Consulting with a GST practitioner or a chartered accountant specializing in indirect taxes would be beneficial to ensure compliance and understanding of specific provisions related to construction services, club memberships, preferential location charges, and other related services under GST.
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