Gst on shed rent

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

13 August 2017 Sir,
Ours is a manufacturing unit with a leased premises. We are paying monthly rent of Rs.82000/- and deducting TDS 10%. GST is applicable . how much

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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13 August 2017 18% GST applicable on such rent.

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Querist : Anonymous

Querist : Anonymous (Querist)

21 August 2017 pl provide HSN CODE

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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27 July 2024 ### GST on Shed Rent

**1. **GST Applicability on Rent:**

**A. **GST Rate:**

- **GST Rate on Rent:** Rent for commercial properties is subject to GST. As per the GST framework, the applicable GST rate on rent for commercial properties is **18%**. This includes both Central GST (CGST) and State GST (SGST) or Integrated GST (IGST) if it is an interstate transaction.

**B. **HSN Code:**

- **HSN Code for Renting:** The HSN code for renting of immovable property is **9972**. This code covers services related to renting of immovable property.

**2. **Calculation and Payment:**

**A. **GST Calculation:**

- **Rent Amount:** Rs. 82,000 per month.
- **GST Rate:** 18%.

**GST Amount = Rent × GST Rate**

**GST Amount = Rs. 82,000 × 18% = Rs. 14,760**

- **Total Amount Payable:** Rs. 82,000 (rent) + Rs. 14,760 (GST) = Rs. 96,760.

**B. **TDS Deduction:**

- **TDS on Rent:** You are deducting TDS at 10%, which applies to the rent amount but not the GST portion. TDS should be calculated on the rent before GST.

**TDS Amount = Rent × TDS Rate**

**TDS Amount = Rs. 82,000 × 10% = Rs. 8,200**

- **Total Payment to Landlord:** Rs. 82,000 (rent) + Rs. 14,760 (GST) - Rs. 8,200 (TDS) = Rs. 88,560.

**3. **Documentation and Compliance:**

**A. **Invoice:**

- **GST Invoice:** Ensure that the landlord issues a GST-compliant invoice including the rent amount, GST, and HSN code (9972).

**B. **Reporting:**

- **GST Returns:** Report the GST on rent in your GST returns (GSTR-1 and GSTR-3B).

**C. **Claiming ITC:**

- **Input Tax Credit (ITC):** You can claim ITC on the GST paid on rent if the rented premises are used for business purposes. Ensure that the rent is supported by a proper GST invoice.

### **Summary**

1. **GST Rate on Rent:** **18%** GST is applicable on commercial property rent.
2. **HSN Code:** **9972** for services related to renting of immovable property.
3. **GST Calculation:** Rs. 14,760 on Rs. 82,000 rent.
4. **TDS Deduction:** Deduct TDS at 10% on the rent amount, not on GST.

### **References**

- **GST Rate Notifications:** Relevant notifications regarding GST rates on renting of immovable property.
- **HSN Code 9972:** Covers renting of immovable property.

For precise compliance and further advice, consulting with a GST professional or tax advisor is recommended.

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