Now it’s time to take decision by All the Real Estate Developers for their Ongoing Residential Projects whether to opt for Existing GST regime i.e. effective GST Rate of 12% and 8% for other than affordable and affordable residential project respectively with ITC or else automatically migrated to new GST regime i.e. effective GST rate of 5% and 1% for other than affordable and affordable residential project respectively without ITC.
Lot of discussions are going on since March 29th, 2019 when notifications in this regard are issued by Government. As per my understanding, options are not two but three:
1. Opt for existing regime ;
2. Do not opt for existing regime .i.e. migrated to new regime automatically.
3. Hybrid i.e. charge 5% or 1% and still take ITC; possible?
Obviously, we can choose the options projectwise.
How we can go for the third option? Answer may be to opt for existing regime and charge lesser GST rate of 5% or 1% as applicable but pay to Government full rate of 12% or 8% as applicable. This will definitely satisfy your customers and at the same time help you to remain in market.
This may be with one rider i.e. for the existing booked apartments, you can give lesser discount on the remaining payments and for new booking enhance a basis price a little one and at the same time offer discount of 7% on base price on account of difference in GST Rate.
Friends, 10th May is very nearly and this form is not so simple, so please get ready and fill with all causion Annexure IV of No. 3/2019 CT (R) well before 10th May with your jurisdictional GST Commissioner.
I recommend that we should file this this form to both Central and State GST Commissioner as Jurisdictional issue is not so robost presently that you can take a chance in this very important matter.
Finally, please avoid filing this form if you are interested in migrating in new GST regime.
Hope this will help all us to do justice with our business, emoployer & Clients.
CA Sanjay Kumar Agrawal Email: email@example.com