GST on Property Purchase India 2026 — Under Construction Flat, Stamp Duty & ITC
Updated: 3 June 2026 | CGST Act | Rates from 1 April 2019 | No GST on Ready Possession
GST applies only to under-construction properties: 1% for affordable housing (≤₹45L + ≤60/90 sqm carpet area); 5% for other residential; 12% for commercial. Once a property gets its Occupancy Certificate (OC), no GST applies — only stamp duty. Homebuyers of residential properties cannot claim ITC on GST paid.
0% GST
No GST on ready possession / completed property — only Stamp Duty & Registration Fee applies.
Under-construction residential: 1% or 5% GST. Under-construction commercial: 12% GST (with ITC).
Under-construction residential: 1% or 5% GST. Under-construction commercial: 12% GST (with ITC).
GST Rate on Property — Type-wise Summary
| Property Type | Status | GST Rate | ITC to Buyer? | Note |
|---|---|---|---|---|
| Affordable residential (≤₹45L, ≤60/90 sqm carpet) | Under construction | 1% | No | Metro: 60 sqm; Non-metro: 90 sqm |
| Non-affordable residential flat | Under construction | 5% | No | No ITC since April 2019 |
| Any residential property | Ready possession (OC/CC issued) | 0% (nil) | N/A | Stamp duty applies instead |
| Commercial office / shop | Under construction | 12% | Yes | Buyer can claim ITC if registered |
| Commercial property | Ready possession | 0% (nil) | N/A | Stamp duty applies |
| Plot / Land | Any | 0% (nil) | N/A | Land is not a supply under GST |
| Residential rent (individual tenant) | — | Exempt | N/A | GST exempt for residential use |
| Commercial rent (to registered person) | — | 18% | Yes (tenant's ITC) | RCM if landlord unregistered |
Affordable Housing Criteria for 1% GST
For the 1% GST rate, a residential property must satisfy ALL three conditions simultaneously:
- Price: Total consideration ≤ ₹45 lakh (excluding GST)
- Carpet area in metro cities (Delhi NCR, Mumbai, Bangalore, Hyderabad, Chennai, Pune, Ahmedabad, Kolkata): ≤ 60 square metres
- Carpet area in non-metro cities: ≤ 90 square metres
- The flat must be part of a Real Estate Project (REP) under RERA
Frequently Asked Questions
What is the GST on an under-construction flat purchase?
GST on under-construction flat (from 1 April 2019): Affordable housing — price ≤ ₹45 lakh AND carpet area ≤ 60 sqm in metro cities (or ≤ 90 sqm in non-metro): 1% GST, no ITC. Other under-construction residential (non-affordable): 5% GST, no ITC. Commercial property under construction: 12% GST, ITC allowed. These rates apply to the agreement value (total consideration excluding GST). Builder collects GST from the buyer and pays to the government. GST is NOT applicable once the property receives Completion Certificate / Occupancy Certificate.
Is there GST on a ready-to-move property purchase?
No — there is NO GST on ready-to-move (completed) property purchases. Under GST law, sale of immovable property that has received Completion Certificate (CC) or Occupancy Certificate (OC) is treated as a sale of immovable property — not a "supply of goods or services" under GST. Therefore: no GST charged to buyer; buyer pays only Stamp Duty (5–8% depending on state) and Registration Fee (1%). GST applies only during construction phase (before OC). Buyers of under-construction properties are liable for GST on the instalments paid.
What is the stamp duty on property — is it separate from GST?
Yes — stamp duty is entirely separate from GST and is charged by the State government. For under-construction property: GST is charged on the property value; stamp duty is also charged on registration of sale deed/agreement (but typically only on agreement value minus GST for some states). For ready possession property: only stamp duty (5–8%) and registration fee (1%) apply; no GST. You cannot get ITC of stamp duty or registration charges against your GST liability. Both GST (on under-construction) and stamp duty (on registration) can apply to the same under-construction property — though states vary in how they compute stamp duty base for registered agreements.
Can a homebuyer claim ITC on GST paid for flat purchase?
No. Since 1 April 2019, homebuyers of residential properties (under-construction) CANNOT claim Input Tax Credit (ITC) on GST paid. The reduced rate of 1%/5% for residential properties was introduced with the explicit condition of no ITC. Previously, under the old regime (before April 2019), the rate was 12% with ITC. Developers also cannot pass on ITC to residential homebuyers (ITC is blocked for residential construction). For commercial property under construction at 12% GST: buyers who are GST-registered businesses CAN claim ITC on the 12% GST paid.
What is GST on joint development agreement (JDA)?
Joint Development Agreement (JDA) between landowner and developer attracts GST in a complex manner: Landowner transfers development rights (FSI) to developer: taxable supply — developer pays GST at 18% on the value of development rights (on reverse charge where applicable). Developer provides construction services to landowner against the landowner's share of flats/units: taxable supply — developer charges GST (1%/5%/12% depending on type) on the value of construction services for the landowner's share. GST on JDA is calculated at the time the CC/OC is issued. The valuation can be based on similar property prices or agreed consideration. This is a specialized area — professional advice recommended for JDA transactions.
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