GST on Development Agreement
GST on Development Agreements in India is governed by specific notifications and rules, with
different rates and applicability depending on the type of project and timing of booking.
Residential Projects
 Units booked before Receipt of OC (Occupancy Certificate):
No GST is payable by the builder on the development agreement consideration for these
units. This is exempt under Notification No. 12/2017, Entry No. 41A (amended by 4/2019
dated 29.03.2019)
 Units not booked before Receipt of OC:
GST is payable by the builder at 18% of the development agreement consideration related
to unsold inventory, or at the GST rate of 1% or 5% of the market price of unsold inventory,
whichever is lower. This is also as per Notification No. 12/2017, Entry No. 41A and
11/2017 (amended by 4/2019 dated 29.03.2019)
Commercial Projects and Commercial Units
 Commercial Projects or commercial units in mixed projects:
GST is payable by the builder at 18% of the development agreement consideration
pertaining to commercial units. The exemption for residential apartments does not apply
here, as per Notification No. 12/2017, Entry No. 41A
Plotted Projects
 GST is payable by the builder at 18% of the development agreement consideration. The
exemption for residential apartments does not apply to plotted projects, as per Notification
No. 12/2017, Entry No. 41A .
18% Rate on Development Agreement
 The 18% GST rate on development agreement consideration is specified in Notification
No. 11/2017 Central Tax (Rate), dated 28.06.2017, Entry No. 16(iii) IN HEADING 9972.
Reference can be made to Question 7 of FAQS (part II) on Real Estate F NO.354/32/2019
TRU dated 14.05.2019
Summary Table