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Developed land sold as plots will attract GST: AAR

  • Jun 22, 2020 | Divita S Gupta

Developed land sold as plots will attract GST: AAR

The Gujarat bench of the Appellate Authority for Advance Ruling has held that sale of land for which real estate developers have provided primary amenities such as drainage, waterline and electricity will attract GST. Developed plots as the ones described above are covered under the clause ‘construction of a complex intended for sale to a buyer’ and therefore are liable to attract GST. An applicant sought an advance ruling to understand if GST was applicable on the sale of a plot of land for which the applicant provided primary amenities such as a drainage line, a water line, an electricity connection, land levelling etc. The Gujarat bench observed that the price of the amenities would be included while selling the plot and therefore, should attract GST. Experts have suggested that this ruling will take away the neutral status awarded to developed plots and is likely to have an adverse impact on real estate sales.

Avalara helps businesses of all sizes get GST return filing, e-way bill generation and e-invoicing right with cloud-based GST compliance solutions in India. Goods and Services Tax (GST) rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Divita S Gupta
Avalara Author Divita S Gupta
Divita has served as a writer and editor for top financial services organizations in India. She has written on topics like mutual funds, insurance, taxes, SME financing for globally recognized banking and financial organizations including ICICI, Aditya Birla Group, News Corp. With a Masters in Business Administration from Symbiosis International University, she currently owns a small business in Mumbai.

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