Tax planning important for realtors, says consultant
Chartered Accountant and tax consultant A Siva Prasad says the realtors can either opt for gold GST rule or new GST rule.
If the realtors fail to inform the GST officials of their choice by May 10, they will come under the new GST rule.
Vijayawada: Tax consultant and Chartered Accountant A Siva Prasad has said that taxation planning is very important and asked the realtors to study the old and new Goods and Services Tax (GST) rules clearly to opt for either the old GST rates rules or the new GST rules.
He said the realtors have time till May 10 to decide and inform the respective officials about their choice. Siva Prasad on Monday participated in an interactive session organised by the Confederation of Real estate Developers of India (CREDAI), Andhra Pradesh chapter, with property developers and real estate companies in a hotel here.
He said the GST Council framed new rules for the real estate companies in the country. He said the realtors were given a choice to follow either the old rule or the new GST rule.
Speaking on the occasion, Siva Prasad said if the realtors fail to inform the GST officials of their choice by May 10, they will come under the new GST rule.
He said the GST Council had given the option to real estate companies to either opt for old rates of 12 per cent (for residential) and 8 per cent (affordable housing) with input tax credit benefits or the new tax rates of 5 per cent for residential units and 1 per cent for affordable housing without the benefit of adjusting the credit on inputs used during construction.
He clarified the queries raised by the property developers in the interactive session. He explained the old GST rules and new GST rules on construction of commercial, residential structures and semi-residential structures.
He said tax planning is important for any organisation and realtors must know the rules and regulations to avoid problems in future.
Credai Vijayawada chapter president R V Swamy said that this is the perfect time for the property buyers to purchase flats as the Central government is collecting only 1 per cent GST on the property value.
He said one per cent will be applicable to the properties, which have value less than Rs 45 lakh. He said the CREDAI is trying to create awareness among the property developers and real estate companies on the tax and rules framed and implemented by the government.