Hi all I am buying a flat in hyderabad where the OC has been recieved for the tower? What is the best way to buy it? The seller hasnt yet registered the property. The Builder is suggesting the following method 1. Execute a tripartite agreement between buyer , seller and builder the following charges will apply Seller a. Transfer charges b. GST on Transfer charges Buyer a. Sales Tax and VAT on the amount already paid by the seller(i.e 56 Lakhs) b. Stamp Duty at 6% c. GST on the remaining amount from the buyer i.e 3 Lakhs Are the above mentioned VAT and Sales Tax to be borne by Buyer(me)? Is this the best way to do it? Would it best if the seller registers the flat first and then sells it?
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Insist on purchaser registering flat in his name
2) then only should you purchase it from seller
3) VAT is leviable only on under construction flats
4) in the present case OC is issued .
5) you are not liable to pay any sales tax ,VAT
6) GST would not be leviable on resale flat s
7) further liability of transfer charges is on seller
8) stamp duty and registration charges are to be paid by you
Hi Ajay Based on your response. Please answer the follow up questions. Comments are point wise based on your answer. 5. OC is being recieved tower by tower, there are 10 towers.. would the Sales Tax and VAT still not apply. If they apply, who should pay it. 6. Seller still has some outstanding amount to the builder, would GST apply on it? If yes, who should pay it 7. What you mean by further liability of transfer charges, if the seller has already registered the flat? Would he still need to pay transfer charges to the builder..or do you mean transfer with municipal authorities ...i.e mutation charges 8. would the stamp duty and registration charges paid by me be same as seller as paid in Point 1.
seller has to pay GST on amount payable by him
2)since society is not formed on sale of flat by the seller consent of builder is necessary . builder would levy transfer charges for transfer of flat in your name . it is liability of seller to pay transfer charges . generally transfer charges are split between the parties
3) VAT is leviable only on under construction flats . if seller has bought under construction he has to pay VAT . once OC is issued no VAT is payable . as purchaser if you buy flat for which OC has been issued you are not liable to pay VAT
For buying a flat from the agreement holder, a tripartite agreement may be entered with the seller and the builder.
The conditions may be discussed and agreed thereon.
If the seller had already paid the VAT and other taxes and if the sale consideration price do not include them, if negotiations confirm, then you may have to bear that.
This is a circumstantial event/expense, you may not find any law or rule to confirm this stand, it is practical situation that will dominate.
Service tax is payable only on property purchase directly from developers and is not required in case of resale property purchase as there is no service provided.
The government levies service tax on 25% of the cost of the flat. This effectively brings the service tax rate to 3.5%. When a buyer purchases a property, he/she might be asked by the seller to pay service tax and VAT.
The balance of sale consideration is to be paid along with the applicable GST by the buyer
If the seller has already registered the flat on his name then the transfer charges would be applicable, however if the seller has just registered the sale agreement and not the sale deed then this transfer charges may not be applicable.
The stamp duty and the registration charges are to be paid by for the property being registered on your name.