Lucknow/Greater Noida: The Uttar Pradesh Real Estate Regulatory Authority (UP RERA) has issued fresh guidelines to safeguard the interests of homebuyers by clarifying the process for claiming refunds of Goods and Services Tax (GST) collected in excess by real estate promoters. The authority has also directed all registered promoters to strictly adhere to the GST rates notified by the Central Government.
According to UP RERA, eligible homebuyers who have paid GST at rates higher than those prescribed can now seek refunds through the online mechanism developed by the State Tax Department. The authority reiterated that all registered real estate projects in Uttar Pradesh must levy GST only at the rates notified by the Centre and reminded promoters that detailed instructions had already been issued through its circular dated January 8, 2025.
Despite these directions, UP RERA said it has received instances where homebuyers were charged GST beyond the prescribed rates. To address such cases, the authority coordinated with the State Tax Department to establish a clear refund mechanism for affected buyers.
Under the clarified procedure, an unregistered homebuyer who has paid GST while purchasing a flat or availing construction services can claim a refund directly from the GST Department if the project is cancelled, the agreement is terminated or the allotment is cancelled after the statutory deadline for the promoter to issue a credit note has expired.
To apply, the buyer must first obtain temporary registration on the GST portal using their Permanent Account Number (PAN). The refund application must then be submitted under the “Refund for Unregistered Person” category using Form GST RFD-01, along with proof of tax payment, supporting documents and the necessary certificate issued by the promoter. Refunds will be processed after verification of the application and documents by the competent GST authorities in accordance with applicable laws.
UP RERA also highlighted that where the statutory period for issuing a credit note is still available at the time of cancellation or termination of the agreement, the promoter is responsible for issuing the credit note or refunding the entire amount, including GST. Homebuyers are required to apply directly to the GST Department only in cases where the promoter can no longer issue a credit note under the law.
The authority further noted that refund claims must be filed within two years from the date of cancellation or termination of the agreement. Claims involving GST amounts of less than ₹1,000 will not be eligible for refunds.
Reiterating its commitment to consumer protection, UP RERA has instructed all registered promoters to ensure full compliance with notified GST rates and refrain from collecting excess tax under any circumstances. The authority said that wherever excess GST has been collected, promoters must facilitate refunds in accordance with the applicable legal provisions and the guidelines issued by the State Tax Department.
UP RERA stated that the latest initiative is aimed at strengthening transparency, tax compliance and consumer protection in the real estate sector while ensuring that eligible homebuyers can recover excess GST paid on their property transactions.
