Announcement

Collapse
No announcement yet.

Service Tax Clarifications Required

Collapse
X
Collapse

Service Tax Clarifications Required

Last updated: December 13 2015
28 | Posts
5810 | Views
  • Time
  • Show
Clear All
new posts

  • Service Tax Clarifications Required

    Guys, can any of you tell me 'exactly' what's going on with the service tax issue...?? My builder is asking me to pay approx. 2.6% of the agreement value.
  • #2

    #2

    Re : Service Tax Clarifications Required

    Originally posted by newone View Post
    Guys, can any of you tell me 'exactly' what's going on with the service tax issue...?? My builder is asking me to pay approx. 2.6% of the agreement value.
    Clarification is as under -

    The Central Government, vide its Notification No.1/2006-ST dated 1.3.2006,
    as amended by Notification No.29/2010-ST dated 22.6.2010, w.e.f. 1.7.2010
    and Notification No.36/2010 dated 28th June, 2010, has brought the
    “Construction of complexes” under the taxable service net under the
    aforesaid Service Tax Act. Accordingly all Residential or Commercial units
    constructed and allotted/sold are now subject to Service Tax at appropriate
    rate. The rate of Service Tax applicable on various Sub-heads under which
    payments are to be made for the Residential/Commercial/Retail Units are
    given below :

    Description | Applicable Service Tax
    ------------------------------------------+------------------------------------------
    Basic Sale Price (BSP) | 2.575 %
    ------------------------------------------+------------------------------------------
    Preferential Location Charge (PLC); | 10.3%
    club membership; maintenance charge; |
    other charges |
    ------------------------------------------+------------------------------------------
    EDC/IDC; IFMS; IBMS; Car Park | Nil




    The aforesaid Service Tax is applicable on all payments made by you on or
    after 1st July 2010. The payments received upto 30th June, 2010 are exempt
    from the aforesaid Service Tax. It may please be noted that the Service Tax
    is linked to the actual date of payment and not linked with the date of
    Payment Request.

    For all Payment Requests raised upto 30th June, 2010 (if not already paid
    before 30.6.2010), you are requested to add the Service Tax amount (as per
    rates specified in Annexure-I) and pay along with the Payment Request
    Amount.


    I hope , the above clarifies yr. issue.
    Please read IREF rules | FAQ's

    Comment

    • #3

      #3

      Re : Service Tax Clarifications Required

      Originally posted by newone View Post
      Guys, can any of you tell me 'exactly' what's going on with the service tax issue...?? My builder is asking me to pay approx. 2.6% of the agreement value.
      Dear newone,

      The ST of 2.575% on Agreement Value was applicable from 1st July 2010. Any payments made after this notification date will attract ST. Flats with completion certificate are exempted from ST.

      Now as per the latest news MCHI has filed a Writ Petition against Central Service Tax Dept in Bombay High Court for which the Hon Court has given interim stay. At moment everyone is waiting for the final hearing. Till that time you need to pay ST on your payments.
      Last edited December 5 2015, 09:11 AM. Reason: Text formatting.
      Jitendra Pethkar | Pethkar Projects

      Comment

      • #4

        #4

        Re : Service Tax Clarifications Required

        Hi Jitu Sir, when is the next hearing (September - but what date?)
        Venky (Please read watch a or before posting)

        Comment

        • #5

          #5

          Re : Service Tax Clarifications Required

          Thanks a lot Manoj and Jitendra

          Comment

          • #6

            #6

            Re : Service Tax Clarifications Required

            High court has put an stay on service tax. Check "PUDHARI" newspaper dated 30th july 2010.

            Comment

            • #7

              #7

              Re : Service Tax Clarifications Required

              Originally posted by Venkytalks View Post
              Hi Jitu Sir, when is the next hearing (September - but what date?)
              Dear Venkytalks,
              Didn't get the latest update on the next hearing date. Will provide it asap.
              Jitendra Pethkar | Pethkar Projects

              Comment

              • #8

                #8

                Re : Service Tax Clarifications Required

                Originally posted by Jitu_Sir View Post
                Dear newone,
                The ST of 2.575% on Agreement Value was applicable from 1st July 2010. Any payments made after this notification date will attract ST. Flats with completion certificate are exempted from ST.
                Now as per the latest news MCHI has filed a Writ Petition against Central Service Tax Dept in Bombay High Court for which the Hon Court has given interim stay. At moment everyone is waiting for the final hearing. Till that time you need to pay ST on your payments.
                Does this also apply to projects for which registration has been done before 1st July? What if project was booked 2 yrs ago and only the last installment was paid after 1st July?

                Comment

                • #9

                  #9

                  Re : Service Tax Clarifications Required

                  Originally posted by lazybone007 View Post
                  Does this also apply to projects for which registration has been done before 1st July? What if project was booked 2 yrs ago and only the last installment was paid after 1st July?
                  Dear lazybone007,
                  ST is applicable to flats registered before 1st July 2010 as well. In such case ST of 2.575% shall be applicable on payments for those installments made after the notification date.
                  Last edited September 1 2010, 12:12 AM.
                  Jitendra Pethkar | Pethkar Projects

                  Comment

                  • #10

                    #10

                    Re : Service Tax Clarifications Required

                    The current situation is very confusing. The builders are still demanding 2.575% service-tax even when there is an interim stay by HC.

                    BTW, i read somewhere (don't have the link now) that next hearing date is 8th Sept.

                    Comment

                    Have any questions or thoughts about this?
                    Working...
                    X