Definition
In India, the Goods and Services Tax (GST) overhauled the taxation of the construction sector. Different tax slabs apply based on the activity: e.g., cement attracts 28% GST, steel 18%, and affordable housing construction services may attract 1% or 5% without Input Tax Credit (ITC). Managing these slabs is critical for accurate project cost estimation.
Practical Example
A developer purchasing ₹10 Lakhs worth of structural steel must pay an 18% GST (₹1.8 Lakhs) to the supplier. Depending on the specific rules of their housing project (e.g., affordable vs premium), the developer's accountant must determine if they can claim this ₹1.8 Lakhs back as Input Tax Credit against the GST collected from homebuyers.
Application in Superwise
Superwise is deeply integrated with Indian taxation norms. When a Purchase Order is created, Superwise automatically applies the correct HSN codes and GST slabs (CGST, SGST, IGST) to the materials. This ensures the resulting Purchase Bill is mathematically flawless, allowing accounts to claim their Input Tax Credit without audit errors.
Related Feature
Learn how Superwise handles this in our dedicated feature:
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