I am in the process of buying a residential flat in Bangalore. The proje ct is under construction and the posession will be in Dec 2010. My query is 'Whether kvat is applicable to the cost? if yes, what is the percentage. Further, is Service tax applicable?
20 July 2009
If there is a single agreement for sale of immovable property then no VAT. If 2 agreements then on the construction part either composition without set off of input VAT paid for cemment steel etc. Or regular scheme 12.5 % on 70% of the construction contract. IN this case credit of steel , cement available. Net cost to the contractor wouldbe 2-3%.
27 July 2009
Thankyou Sir, for your time in responding to my query. My flat ventures have given the following breakdown saying that their's is a Composition Scheme. Is this valid. Is negotiation possible in any of the factor?
------------- Value of Invoice----- KVAT @ 12.5%
Construction--- 3573120 -------- 312648 Cost of Flat
CAclubindia
