ifms full form in real estate :-
IFMS Full Form is Interest Free Maintenance Security Charges. It is an additional charge given by the property buyers to the builders & developers until the formation of the residents’ welfare association (RAWs) for maintenance, upkeep, security purposes, and developmental projects.
IFMS is a non-refundable charge that is diluted as soon as the welfare association is formed. It is one time payment (including taxes) that is usually categorized into hidden charges. An 18% GST is levied at the time of payment. The IFMS in real estate is not fixed. It differs from one property to another. For instance, it will be different for commercial properties compared to residential properties. The only constant factor in it is GST of 18%.
As the name suggests “Interest-free” the amount is transferred to the developer’s account without any interest and once the RWA gets into action, the same gets transferred into their account.
According to the rules stated by RERA, the builders & developers will have to mention all the charges including IFMS and sinking funds for transparency amongst all.
Is it applicable only to the residents?
As mentioned earlier, IFMS is an additional charge paid by the buyer at the time of investment in a property. It can be any property, residential or commercial; the tax shall be levied on the buyer for the future maintenance purposes.
Will it be included in the security deposit/token money?
IFMS in real estate is completely different from the security deposits and token money. It is the additional charge that is specifically transferred to a different account until the developer forms the Residential Welfare Association.
Is it similar to sinking funds?
The builders & developers have differentiated the two. IFMS is used for the recurring expenses while the sinking funds are used for emergency purposes and repairs.