Service Tax computation for Flat under construction

Share This Thread
  1. v_rajasekar_99

    v_rajasekar_99 New Member

    Dear Sir,

    As read in your article, there are two ways of computing service tax on property under construction.

    1) Flat Value (including car park, club house etc) MINUS land cost. This is called construction value.
    (Now a days, flat promoters first register UDS and then enter into construction amount which shows only this amount).
    Now, how much % of this construction value will attract 15% service tax (as there are materials involved and only the promoter charges are considered as service and taxed).
    Will it be 30% of construction value taxed at 15% for service tax?

    2) The other method is either 25% (less than 1crore) or 30% (greater than 1 crore) of total cost considered for 15% service tax

    I find that investors are cheated by the promoters where they charge indifferently and collect excess service tax.

    Your guidance will help investors to save on their hard earned money.

    Further, can we demand a Service Tax Collection Certificate from the promotor and check with competent authority if the same was remitted to them?

    Thanks for your time and clarification
  2. v_rajasekar_99

    v_rajasekar_99 New Member

    Also, builders are charging service tax on VAT, which i feel is not correct. Please clarify
Draft saved Draft deleted