Get Ready To Pay More Towards Maintenance Charges For Your Apartment From July 1

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    With the implementation of the new tax regime from July 1, you will have to shell out additional 2.5% tax on maintenance charges of your flat. As per the rates decided under the GST, now maintenance charges will attract a tax rate of 18% instead of the existing rate of 15.55%, which is roughly an increase of 2.5%.

    Get Ready To Pay More Towards Maintenance Charges For Your Apartment

    In the outgoing tax regime, the tax structure of 15.55% includes 15% service tax, 0.5% swachh bharat tax and 0.05% non-agricultural tax.

    The increased tax rates shall apply to flat owners who pay a maintenance fee of over Rs. 5000 other than stamp duty, electricity and water charges and property tax. Housing societies with an annual balance or corpus over Rs. 20 lakh shall also attract a similar rate with respect to maintenance charges.

    In a case when for maintenance, renovation or repair of either the flat or society's premises, cement, steel or paint is bought for use; the tax paid on such items shall be deducted from the total tax paid under GST. However, first the GST tax needs to paid upfront and thereafter the credit in lieu of the tax already paid can be claimed.

    According to experts, the effect of GST will be more pronounced on the societies' corpus value. A member of some housing society in a statement said "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."

    GoodReturns.in

    Story first published: Saturday, May 27, 2017, 15:40 [IST]
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