{"id":8124,"date":"2026-02-20T13:13:30","date_gmt":"2026-02-20T07:43:30","guid":{"rendered":"http:\/\/13.201.127.58\/?p=8124"},"modified":"2026-03-10T19:17:28","modified_gmt":"2026-03-10T13:47:28","slug":"the-hidden-costs-of-gst-on-new-home-purchase-you-must-know","status":"publish","type":"post","link":"https:\/\/asbl.in\/blog\/the-hidden-costs-of-gst-on-new-home-purchase-you-must-know\/","title":{"rendered":"What to Expect After Signing the Sale Agreement: Finalizing Your Home Purchase"},"content":{"rendered":"

<\/span>Understanding Your Sale Agreement<\/span><\/h2>\n

Purchasing a new home? It starts with that sale agreement. This document is crucial. It’s like the first handshake between you and the builder. Dive into the details. Every last clause. Make sure unit specifics, total costs, payment timelines, possession dates, everything is crystal clear. Don\u2019t forget to verify the RERA registration number, project approvals, and the expected timelines. No one likes delays, right? For RERA checks, use our handy project search guide. Source<\/a><\/p>\n

<\/span>Key Financial Clauses and Taxes<\/span><\/h3>\n

Next up, the financial side. The sale agreement should list all the taxes the builder will charge. GST applies only to under-construction homes, not the ones you can move into right away. Confirm if the GST on new home purchase is part of the overall price or if it\u2019s tacked on later. Also, keep in mind stamp duty and registration fees are additional. For the latest on GST rates, check out these expert summaries. Source<\/a><\/p>\n\n\n\n\n\n\n
Property type<\/td>\nGST rate<\/td>\nNotes<\/td>\n<\/tr>\n
Affordable under-construction<\/td>\n1% without ITC<\/td>\nSubject to qualifying criteria<\/td>\n<\/tr>\n
Other under-construction<\/td>\n5% without ITC<\/td>\nStandard for non-affordable units<\/td>\n<\/tr>\n
Ready-to-move-in<\/td>\nNil (no GST)<\/td>\nTaxed via stamp duty and registration<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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Unveil the 50-50 payment plan<\/p>\n

1980<\/span> sq. ft at just \u20b92.10 Cr (ALL INCLUSIVE + GST)<\/span><\/div>\n\n\t
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<\/span>Practical Tips Before Signing<\/span><\/h3>\n

A few practical tips:<\/p>\n

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  1. Demand a payment schedule tying amounts to construction milestones.<\/li>\n
  2. Ensure there’s a clear cancellation and refund clause, it\u2019s important.<\/li>\n
  3. Check if the builder will claim the input tax credit or share GST savings with you.<\/li>\n
  4. Review the conditions for defect liability and possession certificates. For more buyer-focused GST advice, check out this homebuyer guide. Source<\/a><\/li>\n<\/ol>\n

    And if something sounds puzzling, definitely get a lawyer or an accountant to rake through that sale agreement before you sign it.<\/p>\n

    <\/span>GST on New Home Purchase: Payment Milestones After Signing the Sale Agreement<\/span><\/h2>\n

    So, you\u2019ve signed the sale agreement. What\u2019s next? Now you need a clear payment plan. First, you\u2019ll shell out a booking or earnest deposit. Then, as construction progresses, expect scheduled installments. Finally, there\u2019s registration and any leftover charges before you take possession. Here\u2019s a heads-up: GST rules can shift the final amount on under-construction properties.<\/p>\n

    <\/span>Who Pays GST and When?<\/span><\/h3>\n

    Remember, GST kicks in for under-construction homes. Builders collect this GST alongside stage payments, so always ask for a breakdown. Get it in writing! Rates can fluctuate based on property type, and recent reforms affect this too. For the nitty-gritty on changes, consult a detailed tax brief. Source <\/a>| Source<\/a><\/p>\n\n\n\n\n\n\n\n
    Milestone<\/td>\nTypical % of BSP<\/td>\nTrigger<\/td>\nGST Applies?<\/td>\n<\/tr>\n
    Booking\/Token<\/td>\n1-5%<\/td>\nOn signing agreement<\/td>\nGenerally yes for U\/C<\/td>\n<\/tr>\n
    Down payment<\/td>\n10-20%<\/td>\nWithin 30-60 days<\/td>\nYes for U\/C<\/td>\n<\/tr>\n
    Construction-linked installments<\/td>\n40-60% total<\/td>\nOn slab\/finishing<\/td>\nYes for U\/C<\/td>\n<\/tr>\n
    Final\/Registration<\/td>\nRemaining<\/td>\nBefore possession<\/td>\nNo if RTO\/OC ready<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

    <\/span>What to Check and Action Points<\/span><\/h3>\n