Builders Charge GST on Maintenance Despite Being Exempt


GST impact on the Maintenance Bill
GST impact on the Maintenance Bill

Home buyers of Supertech Eco Village-1 are worried and feeling helpless as their builder has charged 18% GST on their maintenance bill. This is despite the fact that their monthly maintenance charges are barely Rs 2000 rupees a month. As per the Goods and Services Tax law, maintenance charges upto Rs 5000 a month are exempt from GST. Although the Finance Ministry has issued a clarification, this arbitrary calculation of GST done by the builder has left home owners like Sumeet Saxena confused.

Sumeet, a resident of Supertech Eco Village says, "Three or four societies in Greater Noida West have started charging 18% GST on maintenance charges. They have sent messages to us and have started deducting the money."

Deepal Diwedy of the same housing society says, "The builder Supertech is making undue profits. GST has caused a lot of confusion. We do not know where to go."

 

But the builder has his own explanation, M K Arora, CMD of Supertech says, "If the builder or any company appointed by the builder is taking care of the facilities and maintenance, all residents have to pay GST whether its Rs 2000 or Rs 5000."

Recently a clarification issued by the Finance Ministry reiterated that the supply of service by RWA, unincorporated body or a registered non- profit entity, to its own members by way of reimbursement of charges up to an amount of five thousand rupees per month per member for providing services and goods for the common use of its members in a housing society or a residential complex are exempt from GST. RWAs will have to pay GST on monthly contributions over than Rs. 5000 per member and if the annual turnover of RWA is over Rs. 20 lakhs. 

Suyash Pandey, resident of Stellar Jeevan in Greater Noida West says, "Exempt maintenance from GST. Just like Municipalities provide services to the people, societies are also providing services to the residents. Why charge GST from them?"

The confusion regarding the impact of GST on property prices is not over yet and now there is this added confusion of GST on maintenance charges. Despite the best efforts of the government and the GST masterclasses being organised by the Finance Ministry, the confusion regarding GST rates remians unresolved.
 

9,422 thoughts on “Builders Charge GST on Maintenance Despite Being Exempt

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  3. Skytech Builder is charging unjustified maintenance charges plus GST on that.As per GST policy GST is applicable on maintenance more than RS 5000. Please clarify is GST is applicatble if Builder is running the maintenance in society.

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    Do we have any rules how long builder can provide the maintenance services? This is already 7th years of the building, but they are not ready to leave.

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