What is a abatement % for calculating the Service Tax on Flat purchase?

POSTED BY Siddu ON January 30, 2013 10:17 pm COMMENTS (5)

Hi,

I am from Bangalore, I have bought a flat in Nov 2011
(pre-construction) and now the flat is ready to occupy. I would like to go for
a registration in first week of Feb 2013.

My builder is asking a huge amount of Service tax and VAT
(much more than what was calculated and told me earlier).

Please can you help me with total service tax and total VAT ?

My property details are given below:

Location: Bangalore – Karnataka (Bannerghatta Road)

Basic Cost: Rs 29,53,986/- (Total SqFt * Rate per SqFt)

Car Parking: Rs 1,50,000/-

KPTCL (Electricity Connection): Rs 1,08,885/-

BWSSB (Water Connection: Rs 1,08,885/-

Aminities + SBT (like swimming pool, gym, children’s play
area, club house etc..) = Rs 1,25,000/-

I understand that the current Service tax rate is 12.36% and
the VAT rate in Karnataka is 5.5% (Not very sure on the VAT Rate though)

I have specific questions:

1.      
What all amount should be included while
calculating the Service Tax (Is car parking, Amenities included??)

2.      
What is the current abatement rate for service
tax (should we take 33% or 25%  of gross
value)?

3.      
How much is the VAT ? Is it calculated on total
amount?? What all it includes.

It would be helpful if you tell me the total Service tax
amount and the VAT amount which I need to pay.

Thanks for your help in advance.

Note: the builder has not got the completion certificate
from the authorities.

5 replies on this article “What is a abatement % for calculating the Service Tax on Flat purchase?”

  1. Siddu says:

    Hi Ashal,

    Thanks a tonne for all your answers. Helps me a lot.

    Regards,
    Sidram

  2. Dear Siddu, there are enough court rulings that a builder can not charge for car parking in a scheme but the main question is, do you have the time, energy & guts to fight it out against your builder? if yes is the answer, from your side, No is my answer. No car parking can not be added into gross value. If No is your answer that you can not fight it out. Yes is my answer. Please surrender meekly & pay to what’s offered by your builder.

    Chose whatever you want to. :0 🙂

    Thanks

    Ashal

  3. Siddu says:

    Hi Ashal,

    Thanks for your quick reply, just to clarify.

    Does the gross value on which we calculate service tax includes the car parling (is Rs 150,000/-) ?

    Regards,
    Sidram

  4. Dear Siddu, The service tax is applicable on 25% of the gross value of your flat. I can not comment on VAT for Karnataka. Please check it from official site of Karnataka Govt.

    Thanks

    Ashal

    1. Siddu says:

      Hi Ashal,

      Thanks for your quick reply, just to clarify.

      Does the gross value on which we calculate service tax includes the car parling (is Rs 150,000/-) ?

      Regards,
      Sidram

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