Apartment Hidden Costs; Here's Everything You Nee To Know

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Hidden Costs

Apart from the equated monthly installments (EMIs), one also has to pay other taxes like a maintenance fee or garbage tax. These fall in the hidden costs.

Costs

Municipal Taxes 

Municipal taxes are those taxes that are levied by local authorities. In this taxes like that of garbage can only be claimed as deductions for calculating the gross annual value of a house property if paid by the property owner.

Tax

Taxes Paid By Tenants

In case the municipal taxes are paid by the tenants, the owners can not claim for the deductions.

Taxes Paid By Tenants

Deduction Claim

One can claim deduction only if one is residing in their own property. 

Deduction Claim

Maintenance Charges

The maintenance charges payable to the resident welfare associations (RWA) are not under the classification of municipal taxes and, therefore, are not eligible for deduction while calculating the taxable value of the rent.

Maintenance Charges

GST Laws

As per the GST laws, RWAs need to take a GST registration and collect the GST if the monthly subscription/contribution from their members is more than Rs 7,500 per member.

GST Laws

Security Deposit

The collection and maintenance of any security deposit for maintenance does not attract GST.

Security Deposit

GST-Registered RWAs

Residents who live in GST-registered RWAs are required to make a higher payout on account of GST if it is payable.

GST

Payable GST

It should be noted that GST may cancel out savings of ITC since it would be payable on the entire monthly maintenance contribution from members.

GST

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