Service tax on a newly underconstruction house
Nilesh Rathor
(Querist) 10 July 2013
This query is : Resolved
I have booked an underconstruction house almost 2 years back. At present its almost ready and the builder is now asking to pay the service tax for the same even.On the total cost of the flat of 14,50,000/- he is going to make two parts. 3,65,000/- for the house rate and rest 10,85,000/- for the construction agreement. and he is telling the total amount to paid by me for service tax is 45,675/-. Means on the total amount of 14,50,000/- @ 3.15% he is charging from me. Is this the amount i have to pay. As i have understood the service tax has to be paid only on the service not even on the material cost. Please guide me on this matter as to what i have to do and how much i should pay. Waiting for a reply as i am expecting the registration very soon so please guide me at the earliest. Thanks.
Nilesh Rathor.
Vineet
(Expert) 10 December 2013
Service tax is payble on entire consideration of under construction flat after 1-7-2010. Since tax is levied at commuted rate of 3.09%, there is no bifurcation between land, material and service.
