Anuj Puri, Chairman – ANAROCK Property Consultants
If you are looking to buy a property or have already invested in one, you will know that there are tax implications involved. Let’s first examine the tax on property purchase and then elaborate on how one can save on it via tax exemptions and deductions.
To begin with, the taxation on property purchase has become much simpler than it was before. With the roll-out of GST, all taxes previously applicable on real estate purchase (VAT, Service Tax etc.) have been subsumed under this single unified tax system.
The overall costs involved in buying a property are broadly divided into two components – the first being the one paid to the builder/seller and other – the statutory and legal costs – to the government.
While the former roughly comprises 80-85% of the overall property cost, the remaining 15-20% goes as taxes to the government coffers.
So, are the taxes same for both under construction and ready-to-move-in properties? The answer is ‘No.’
Statutory and legal costs for under-construction properties vary between 15-20%,
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