Service Tax : Amid of all this steps an amendment has also been made under service tax laws relating to valuation of Construction Service. The r...
Service Tax : Under the new regime of service tax i.e after 01.07.2012 service tax on construction service is explained u/s 66 E(b) i.e. declare...
Service Tax : Decision given by Delhi High Court is for a period prior to July 2012. From July 2012 with introduction of Negative List, all the ...
Service Tax : CA Nikhil M. Jhanwar Decoding Judgment of Delhi HC on Service tax in case of Under-Construction Flats Real estate industry has bee...
Service Tax : We have a lot of verdicts and planning’s as discussed above, but due to the length constraint of a single article, we will be sh...
Service Tax : No Service Tax on Transfer of Immovable Property if entire consideration received after issue of Occupancy Certificate. In order t...
Service Tax : In a decision that might have an impact on realty prices, the Bombay High Court has upheld the decision of the Union government to...
Service Tax : A division bench of the Gujarat high court, headed by chief justice SJ Mukhopadhaya, has issued notices to the Union finance minis...
Service Tax : The Maharashtra Chamber of Housing Industry (MCHI) has said it is hopeful of an early decision on the service tax issue. The secon...
Service Tax : Builders are all set to legally challenge the imposition of the service tax levied by the Centre on flats under construction. The ...
Service Tax : CESTAT Ahmedabad ruled that construction of new buildings or civil structures as turnkey projects falls under Works Contract Servi...
Service Tax : Thus, while the legislative competence of the Parliament to tax the element of service involved cannot be disputed but the levy it...
Service Tax : The Bombay High Court has granted an interim stay on collection of Service Tax levied on buildings under construction, following a...
Service Tax : Construction of a complex intended for sale by the builder before, during or after construction is deemed to be a service provided...
Service Tax : According to the CBEC Education Guide on Taxation of Services, 2012 value of construction service provided to such land owner will...
Service Tax : It has been 'mentioned that many builders charge additional amount known as "floor rise charges" in addition to the normal sale p...
The issue of the imposition of service tax on construction and sale of residential property has long been a matter of concern for the real estate and construction industry as well as for buyers of such residential property. It has gained much prominence after Budget 2010 because of significant amendment made therein towards taxability of sale of flats under service tax.
Costs rise from 1st July 2010 for buyers of under-construction properties due to the imposition of a service tax on builders. Last week, the Central Board of Excise and Customs notified that a service tax of 10 per cent would be levied on the gross value (Excluding abatement) of a housing property under construction from July 1. Only properties built under the Jawaharlal Nehru National Urban Renewal Mission and the Rajiv Awaas Yojana would not be taxed.
The following major changes have been made for real estate builders post the Finance Act 2010, which are made applicable from 1.7.2010. It may be noted that the said amendments would be effective only from this date onwards. The following are these amendments:
What changes have been effected by the Finance Bill, 2010 with respect to construction of commercial / industrial premises and residential complexes?Following changes have been carried out by the Finance Bill, 2010.
Those looking to book a house should do so before July 1. All sales of under-construction houses from July 1 will attract service tax with the finance ministry notifying tax on new services. Sale of immovable property will be deemed to be taxable unless entire consideration is paid after the issuance of completion certificate by a competent authority. However, service tax will be levied only on 25% of the gross sale value of property .
The Institute of Chartered Accountants of India (ICAI), the accounting regulator, is looking to consult with the finance ministry to simplify the structure of service tax on construction activities and push three methods of calculating the tax.
Finance Minister Pranab Mukherjee’s decision to increase the tax concession on construction of real estate complexes from 67 per cent to 75 per cent of the gross value of property, including land value, has been welcomed by the industry and analysts.
In a relief to realty sector and home buyers, Finance Miniser Pranab Mukherjee on Thusday announced tax concessions to the construction sector, which was brought under the ambit of service tax in this year’s Budget.
The Confederation of Real Estate Developers’ Associations of India (CREDAI) further questioned the issue of service tax being brought out at a time when the goods and service tax is expected to be introduced in 10-12 months and has submitted to the Ministry of Finance, a representation on the provisions of the Finance Bill, 2010.
Accounting regulator ICAI has called for excluding land value from the proposed service tax on the realty sector, saying land is a state subject. “When a prospective buyer makes an advance payment to the builder against booking of a specified unit in a building, that part also includes a price towards the land on which the building is being constructed and treating the entire amount being paid by the prospective buyer to the builder would amount to imposing a tax on transfer of land which is a state subject,” ICAI said.
