RENT FROM LAB
This query is : Resolved
Quick Summary
Suresh S. Tejwani
(Querist)
18 April 2026
If property given on rent to a cancer diagnostic laboratory. Is the rental income liable to GST or is it exempt
18 April 2026
GST applicable over the rent, if exceeds basic exemption limit.
14 November 2026
Agree the rent is taxable. Two points complete the answer.
• No exemption via the tenant: Healthcare services by a clinical establishment are exempt (Sl. 74, Notf 12/2017-CT(R)), but that exemption covers the lab's own services, not rent it pays. Renting commercial property to a lab is taxable at 18% (SAC 9972).
• Who pays depends on registration:
– Landlord registered: charges 18% GST on the invoice (forward charge).
– Landlord unregistered (turnover below Rs 20 lakh) and lab registered under GST: the lab pays GST under reverse charge (Notf 09/2024-CT(R), effective 10 October 2024).
– Landlord unregistered and lab unregistered (a lab doing only exempt healthcare often has no GSTIN): no GST.
• Threshold: Commercial rent counts towards the landlord's Rs 20 lakh aggregate turnover. Rent from a residential dwelling let for residence is exempt and also excluded from turnover.
• For the lab: since its outward supplies are exempt, it cannot use the ITC on rent. GST on rent is a cost to it.
• Income tax: the lab deducts TDS on rent above the threshold (Sec 194-I; Sec 393 from 1 April 2026).
• No exemption via the tenant: Healthcare services by a clinical establishment are exempt (Sl. 74, Notf 12/2017-CT(R)), but that exemption covers the lab's own services, not rent it pays. Renting commercial property to a lab is taxable at 18% (SAC 9972).
• Who pays depends on registration:
– Landlord registered: charges 18% GST on the invoice (forward charge).
– Landlord unregistered (turnover below Rs 20 lakh) and lab registered under GST: the lab pays GST under reverse charge (Notf 09/2024-CT(R), effective 10 October 2024).
– Landlord unregistered and lab unregistered (a lab doing only exempt healthcare often has no GSTIN): no GST.
• Threshold: Commercial rent counts towards the landlord's Rs 20 lakh aggregate turnover. Rent from a residential dwelling let for residence is exempt and also excluded from turnover.
• For the lab: since its outward supplies are exempt, it cannot use the ITC on rent. GST on rent is a cost to it.
• Income tax: the lab deducts TDS on rent above the threshold (Sec 194-I; Sec 393 from 1 April 2026).
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