Buying a home is one of the biggest financial decisions in a person’s life. While homebuyers usually compare location, amenities, and price, taxation is often overlooked. One of the most common questions in the Indian real estate market is about Gst On Ready To Move Flats. Do you have to pay GST? If yes, how much? If not, why? This article breaks it down in simple terms.
What is GST in Real Estate?
The Goods and Services Tax (GST) was introduced in India in 2017 to simplify the complex indirect tax structure. For the real estate sector, GST applies mainly to under-construction properties. Homebuyers pay GST at the time of purchase, which adds to the overall cost of the property.
However, GST treatment differs for ready-to-move flats, and that’s where many buyers get confused.
GST on Ready-to-Move Flats
As per government regulations, GST is not applicable on ready-to-move-in flats. This is because a ready-to-move property is considered a completed project, and the sale of such a property is treated as the sale of an immovable asset, not a service.
This means:
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If you are buying a ready-to-move flat from a builder or a previous owner, you do not have to pay GST.
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GST is applicable only if you buy an under-construction flat where the builder is still delivering services like construction.
GST Rates on Under-Construction Properties
To understand the difference better, let’s quickly look at the GST rates:
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Affordable housing projects: 1% GST (without input tax credit)
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Other housing projects: 5% GST (without input tax credit)
So, if you book a property under construction, GST will add to your purchase cost. In contrast, choosing a ready-to-move-in flat saves you from paying any GST.
Benefits of Buying a Ready-to-Move Flat
1. No GST Burden
The biggest advantage is that you save 5–12% of your property cost since no GST is applicable.
2. Immediate Possession
You don’t need to wait years for construction to finish. You can move in or rent it out immediately.
3. What You See is What You Get
Unlike under-construction projects where there’s uncertainty about layout and finishes, with ready-to-move flats you see the exact home before you buy.
4. Rental Income Opportunity
Since the property is ready, you can earn rental income right away, which is especially useful for investors.
Key Things to Remember
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GST does not apply on resale of flats either, since they are treated as immovable property.
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Other charges like stamp duty, registration charges, and maintenance fees will still apply.
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Always verify the property completion certificate to ensure that it qualifies as a ready-to-move-in unit.
GST on Ready-to-Move vs Under-Construction Flats
| Particulars | Ready-to-Move Flat | Under-Construction Flat |
|---|---|---|
| GST Applicable | No | Yes (1% or 5%) |
| Stamp Duty & Registration | Yes | Yes |
| Possession Timeline | Immediate | Depends on construction |
| Price Advantage | Saves GST amount | Includes GST cost |
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For homebuyers looking to minimize costs and avoid tax complications, ready-to-move flats are a smart choice. Since there is no GST applicable, you only pay stamp duty and registration charges, making the transaction simpler and often more economical. Whether you are purchasing for personal use or investment, understanding the GST rules can help you make a well-informed decision.
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