GST on under-construction property
Since 1 April 2019, flats in residential projects attract 1% GST (affordable) or 5% (others) without input tax credit. Ready flats with OC attract none.
Also called: GST on flats, GST on property
Under Notification 11/2017-Central Tax (Rate), as amended by Notification 03/2019 from 1 April 2019, construction of residential apartments by a promoter in a residential real estate project attracts an effective GST of 1% for affordable housing and 5% for other apartments, without input tax credit. The notified rates apply after a deemed one-third deduction for land.
An affordable residential apartment has a carpet area up to 60 sq m in metropolitan cities (Bengaluru, Chennai, Delhi NCR as notified, Hyderabad, Kolkata and Mumbai region) or 90 sq m elsewhere, and a gross amount up to ₹45 lakh.
| Unit type | Effective GST | ITC |
|---|---|---|
| Affordable residential apartment | 1% | Not available |
| Other residential apartment | 5% | Not available |
| Sale after completion certificate / first occupation, full price received after | No GST | Not applicable |
Example: a ₹70,90,000 non-affordable flat attracts 5% GST, or ₹3,54,500, billed with each instalment.
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