The 5% that applies, the 1% that never does in South Delhi, the completion certificate that switches GST off entirely — and how the timing of one document changes the price of the same floor by lakhs.
GST on under construction property in Delhi is 5% of the agreement value, without input tax credit, for residential units that don’t qualify as affordable housing — and no South Delhi builder floor does, since “affordable” means ₹45 lakh and 60 sq m or less (that segment pays 1%). The switch that matters is the completion certificate: a floor sold after its CC (or first occupation) attracts no GST at all, and resale property never attracts GST. These rates survived the September 2025 “GST 2.0” reform unchanged — the reform cut input costs (cement 28%→18%) rather than the buyer’s rate.
GST is the most misunderstood line item in the builder floor market precisely because most of the market never pays it: South Delhi runs overwhelmingly on completed and resale stock, where GST is nil. But the moment you book a floor from a builder during construction — increasingly common as buyers chase first pick of new buildings — the 5% arrives on every instalment. Since the difference on a ₹8 crore floor is ₹40 lakh, the CC date deserves more attention than the marble selection. Here is the full map.
| Transaction | GST | Notes |
|---|---|---|
| Booking a floor from a builder before CC | 5% on each instalment | No ITC to the builder; GST shown separately on demands; TDS applies on the base value excluding GST |
| Buying a completed floor with CC / after first occupation | Nil | The sale of a building after completion is neither goods nor services — outside GST |
| Resale from an individual owner | Nil | The default South Delhi transaction — stamp duty applies, GST does not |
| Affordable housing | 1% | ₹45 lakh and 60 sq m (metro) caps — no premium colony stock qualifies |
| Under-construction commercial space | 12% with ITC | A different regime entirely; shops and offices, not homes |
| Brokerage on any deal | 18% on the fee | On the commission, never on the property — see our commission guide |
| Renting a home to an individual for residence | Nil | Residential renting for residence stays exempt; commercial renting draws 18% |
Two structural points explain the numbers. The 5%/1% rates (in force since April 2019) are concessional composition-style rates without input tax credit — the builder absorbs GST on cement, steel and services and prices it in, which is why the September 2025 cut in cement GST from 28% to 18% matters to buyers indirectly: it trims the builder’s cost base by an estimated 3–5% on materials, easing prices even though your invoice rate is untouched. And the exemption for completed property exists because selling a finished building is treated as a transfer of immovable property — the state taxes that through stamp duty instead, which applies to every scenario above regardless of GST.
A new GK-2 floor at ₹8 crore. Booked during construction: GST at 5% adds ₹40,00,000 across the instalment schedule — on top of stamp duty at registration. The identical floor purchased after the completion certificate: GST nil; only stamp duty and registration apply. Same marble, same terrace, same deed — the CC date alone moves the all-in cost by ₹40 lakh. This is why sophisticated buyers ask for the CC status before the price, and why builders holding finished stock quote “no GST” as a headline feature.
If the builder claims completion, ask for the certificate (or proof of first occupation). No document, no exemption — and a “completed” floor without a CC has larger problems than GST.
The rate, that it’s charged on the base consideration, and what happens if the property completes mid-schedule — instalments demanded after CC on a genuinely completed unit shouldn’t carry GST that the timeline no longer justifies.
The builder’s demands should show GST separately with their GSTIN — your paper trail, and the basis for deducting TDS on the base value excluding GST.
Stamp duty (6–8% all-in) applies whether or not GST does. An under-construction booking stacks both; a completed purchase pays duty alone.
Floors sold by the builder during construction carry GST; the landowner’s retained floors sold after completion typically don’t. In a collaboration building, two floors in the same structure can sit on opposite sides of the GST line.
In this market, GST isn’t a rate. It’s a date — the day the completion certificate arrives.
Only if you buy it from the builder while under construction — then 5% applies on the agreement value. A floor bought after its completion certificate, or any resale floor, carries no GST; stamp duty applies in every case.
No — the September 2025 rate rationalisation left the 1%/5% residential structure untouched. It cut GST on inputs like cement from 28% to 18%, trimming builders’ costs rather than buyers’ invoices.
The 2019 regime traded ITC away for lower headline rates (down from 12% with ITC). Builders absorb tax on materials and services into their pricing — one reason the 2025 cement cut feeds through to prices over time.
A unit priced up to ₹45 lakh with carpet area up to 60 sq m in metros (90 sq m elsewhere) — both conditions together. No premium South Delhi colony stock qualifies, so the working rate here is 5% or nil.
They’re independent: GST (where applicable) is central tax on the construction service; stamp duty is the state levy on the conveyance, applying to every purchase. An under-construction booking pays both; a completed purchase pays duty alone.
GST attaches to consideration for construction service before completion; the agreement should address post-CC instalments explicitly. Have your CA review the schedule — and get the CC date documented, because it anchors the analysis.
No — where GST is shown separately on the builder’s demand, the buyer’s 1% TDS is computed on the base consideration excluding GST, per CBDT’s clarification.
Renting a residential dwelling to an individual for residence is exempt. Commercial renting — and residential property leased to a business for commercial use — draws 18%. Brokerage on any tenancy carries 18% on the fee.
The builder’s construction service and the treatment of development rights carry GST consequences between builder and landowner — a technical area the collaboration agreement should price explicitly with CA advice. For end-buyers, the simple test stands: buying from the builder pre-CC means 5%; buying a completed floor means nil.
No — a homebuyer has no input credit to claim; the 5% is a final cost. Which is exactly why the completed-versus-under-construction decision belongs in your budget maths from day one.
CC status, GST exposure, duty and the payment schedule — we put the true all-in number on the table before you commit. Clean deals only.
Rates reflect the GST regime for real estate in force in July 2026: 1%/5% without ITC for residential under-construction supplies (since 1 April 2019), nil for completed and resale property, 12% with ITC for under-construction commercial space, and 18% on brokerage — unchanged by the rate rationalisation effective 22 September 2025, which reduced input rates including cement (28% to 18%). Verify current notifications at cbic.gov.in and take professional advice for your transaction.
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