Good afternoon Sir , I have purchased flat and i am paying installments as per demands from builder. I am paying Regular payment and GST to the builder. can i claim GST portion while filling IT return this year ? if yes , Under which section i can claim . Thanks in advance

Ans: no.

However, there were certain benefits available for homebuyers under the Income Tax Act that could potentially help reduce their tax liability. These benefits were in the form of deductions and exemptions related to home loans, interest payments, and principal repayments

Ans: It's concerning that the builder issued a handwritten letter for GST payment without providing an official GST invoice or mentioning their GST number. According to GST regulations, all transactions involving GST must be accompanied by a valid GST invoice issued by the registered supplier, containing their GST number.

In this case, the absence of a proper GST invoice raises questions about the legitimacy of the transaction and whether the GST amount was appropriately accounted for and remitted to the government. Handwritten letters without proper documentation may not suffice as valid proof of GST payment.

To address this issue, I recommend seeking clarification from the builder regarding the absence of a formal GST invoice and their GST registration details. If the builder is registered under GST, they should be able to provide a proper GST invoice with their GST number for the amount paid. If they fail to do so or provide insufficient documentation, it may be prudent to consult with a legal advisor or tax expert to explore further steps to ensure compliance with GST regulations and protect your interests.

Ans: There are certain factors on which the applicability of GST depends on the services provided by the contractor such as-

• If the construction is for your own only self residence and not for business purposes, then you generally do not need to pay GST on the contractor's services, even if you took a home loan.

• If the construction is for commercial purposes or you intend to sell the property, GST will usually be applicable on the contractor's services at the standard rate of 18%.

• If the contract involves the contractor providing both labour and materials, it's considered a "works contract".

• GST is applicable on the entire contract value (excluding land cost) at the appropriate rate mentioned above.

• If the contract involves the contractor only providing labour, and you separately buy the materials, it's considered a "labour contract".

• No GST is payable on the labour charges under the current regulations.

Note- Taking a loan for construction wouldn't impact the applicability of GST on the contractor's services.

There are various other clauses in the GST part; for more clarity, please connect with a legal advisor.