GST RCM ON RENT

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This discussion clarifies the applicability of GST Reverse Charge Mechanism (RCM) on rental income. RCM generally applies to rent for commercial properties when rented to a GST-registered business, with the tenant responsible for payment. For residential properties, GST under RCM may apply if rented for commercial use, but not if rented for residential purposes.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)

02 December 2024 IS THERE ANY NOTIFICATION REGARDING RCM ON RENT?
RCM IS TO BE PAID ON ONLY COMMERCIAL PERMISES OR RESIDANCSIAL AND COMMERCIAL BOTH PREMISESIS

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

02 December 2024 1. Notification No. 05/2022-Integrated Tax (Rate)
2. Notification No. 09/2024 – Integrated Tax (Rate) dated 8th October 2024.

Refer: https://taxguru.in/goods-and-service-tax/rcm-residential-property-commercial-property-gst.html

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

02 December 2024 For Residential Property:
If rented for commercial use, GST under RCM may apply.
If rented for residential use, no GST is applicable.
For Commercial Property:
GST under RCM applies if the property is rented to a business registered under GST.
The tenant pays the GST, and not the landlord.

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