If you are planning to buy a flat in Bangalore, then thanks to the revised GST rules and RERA you are bound to get an edge over your purchase. This means apart from getting the right value for the real estate investment, you will also get a series of other monetary benefits on your purchase.
Here is what’s in store for you.
Pay lower tax on under-construction properties
In the GST or Goods and Services Tax regime, irrespective of the state where you buy a property, you will have to pay the stamp duty and registration charges on your purchase. This apart, when buying an under-construction property in Bangalore, unlike the 10% to 11% composite VAT, you will now have to pay 12% GST on your purchase. This is owing to the fact that under the present GST regime, the developer has to pay lower VAT on the total property value in the states where composite VAT was earlier applicable. Moreover, in case of Bangalore, this exemption comes with partial input tax benefit. So, as a homebuyer, if your developer passes on the input credit to you, then your property cost may increase by up to 2%. On the other hand, if the developers forgo the input credit then that is likely to bring down the base property price, which in turn will keep your home purchase within a pocket-friendly value.
Buy ready-to-move-in apartments at great locations without tax hassles
In case of under-construction properties, the developer is allowed to claim input credit for all goods and services they used to construct the house. Now, the benefits of the same can pass on to you as a homebuyer only when the cost of materials and services remains constant or within an affordable range. Volatility in the market or unpredictable rise in material cost can alter the credit value considerably. So, instead of depending on under-construction properties to seek GST benefits, you can buy ready-to-move-in apartments and avail complete GST exemptions. Projects like Godrej Eternity, Sobha Dream Acres, Prestige Birchwood, and many others offer world-class 2 BHK, 3 BHK, and 4 BHK choices that allow you to buy great homes on an affordable price tag without paying as GST.
Invest in the affordable housing sector to increase your gains
To further your gains, you can choose to buy a property under the Indian Government’s ‘affordable housing scheme’. As per the latest GST developments, the government in February this year had asked the developers not to charge service tax on home purchases falling under the PMAY scheme. Even though complete GST exemption for these houses have not yet been finalised, developers can only charge GST to the buyers at 8%. This can be further adjusted against input credit. However, once the complete exemption law is passed homes under PMAY will become even more affordable.
Keep these GST benefits in mind while buying a flat in Bangalore. This will help you hand-pick a property that assures maximum tax benefits. To gain further, apply for a Home Loan from Bajaj Housing Finance Limited. To start with, check your pre-approved offer and apply for a tailor-made home loan that gives you access to up to Rs.3.5 crore in an instant and also offers in-person assistance for site visits and documentation assistance on your home purchase. Avail these benefits to further add to your home buying convenience.