Is ITC available on a property purchase?

Is ITC available for GST paid on a property purchase?

Different scenarios when considering the acquisition of immovable property (plots, apartments, buildings, etc.)

  • Where the full amount has been paid after issuance of the completion certificate, if necessary, by the competent authority or after the first occupation, whichever is earlier.
  • Where the consideration is paid in installments and not completed after completion of the property.
    Where it was considered that the down payment and completion had not yet been completed. (In general, this alternative is not practiced by any wise investor/legislator)
  • In the first alternative in which the exemption is disbursed in a single advance payment, the carrier/seller does not incur any GST tax since this transaction is specifically identified as an exemption from supplies under section 17, subsection (3) of CGST 2017 [ Following “the law”]. Therefore, the issue of ITC treatment would not arise in that case.

    Is ITC available for GST paid on a property purchase?

Since the last two variants were specifically mentioned in sub-paragraph (b) of paragraph 5 of Table 2 of the Act, as a service supply, the carrier/seller must ship the GST at the current rate. Now in these positions, the question seems “whether ITC from the sales tax paid on the purchase of real estate is available or not” liable. In this regard, it should be noted that ITC can take the sales tax paid taking into account the provisions of section 17 (1) and (2) of the Act.

According to sub-section  ITC must be available to the extent that the registered person uses the supplies only for the purpose of strengthening his business. If such supplies are part of the purpose of any business for other purposes, the amount of credit is limited to a large part of the input tax as it is intended for its business purposes.

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In accordance with sub-clause , where goods or services are used or both by the partially registered person in order to obtain taxable supplies including zero-rated supplies under this Act or under the GST Act and partly for the implementation of the excluded supplies Under these laws, the amount of credit is limited to a lot of the input tax as it is related to the said taxable supplies, including zero-grade supplies.

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