IN CASE OF BUILDER IN WHICH 80% OF THE TOTAL PURCHASE ARE REQUIRED TO BE FROM REGISTERED SUPPLIER, PURE LABOUR CONTRACT AWARDED IN CASE OF PURE RESIDENTIAL PROJECT WHICH IS EXEMPT , WILL FALL UNDER URD AND LIABLE FOR PAYMENT OF GST OR WILL BE EXCLUDED WHILE CALCULATING 80 : 20 RATIO . PLEASE CLARIFY

Reply—Inward supplies of exempted goods / services shall be included in the value of supplies from unregistered persons while calculating 80% threshold. This is applicable on all input and input services.

Services by an employee to the employer in the course of or in relation to his employment are neither a goods nor a service as per clause 1 of the Schedule III of CGST Act, 2017. Therefore, Salaries and wages paid by promoter to his employees will not be relevant for the minimum purchase requirement of 80%. Other than this, all expenses will be considered for calculating 80% threshold.

Payment made against pure labour contract will not fall under service by an employee to employer, therefore it will be included while calculating 80% threshold.