By Legal Bureau
GST regime is going to take its toll from July 1. According to this regime , apartment beholders will have to pay nearly 2.5% additional tax on maintenance charges of the flats. This tax will be applicable on the flats which falls in the category of a maintenance charge more than Rs 5,000. And it will be excluding property tax, stamp duty, and electricity and water charges. The new regime of GST is suggesting 18 % maintenance charge while the existing rate is 15.55%.
If material, such as cement, iron bars, sand or paint, will be bought for the renovation or maintenance of the society’s premises or individual flats, the tax on such material will be derived from the overall tax paid by the owner. First the complete GST will be needed to pay and then a credit would have been needed to claim, to get the procedure done about this adjustment.
In the outgoing tax regime, these conditions were the same. Whereas under GST there will be a flat 18% tax, under the outgoing regime the division was 15% service tax,
The increment on this maintenance tax is introduce to cover the taxes on (0.5%) Swachh Bharat tax, and (0.05%) non agriculture tax, totalling 15.55%. Another difference is that while one annual return needed to be filed under the outgoing regime, at least 37 need to be filed under GST.
Animesh Phadnis, a member of Samarth Society, Mulund, said that “ The additional taxation works out to a neat amount that societies stand to lose. Already, due to a delay in conveyance deeds (handing over of land ownership from builder to society), additional stamp duty is paid. The new burden will create further pressure on a society’s corpus.”