Rental income to a Propreitor

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A proprietor operating under the regular GST scheme is asking whether rental income from a property they own needs to be declared as service turnover. The advice given is that if the property is rented for commercial use, GST at 18% is applicable, and a standard GST invoice should be raised. Rental income for dwelling (non-commercial) purposes is exempt from GST. It's also advised to ensure the relevant SAC code for renting services is added to the GSTIN.

Gopalakrishnan. S

Gopalakrishnan. S (Querist)
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17 February 2025 Dear Experts,

One of my friend is running a Proprietary business with GST registration under Regular scheme. He has his place of business in a rented premisses.
At the same time, he owns a building in some other place, which he wants to let out for rent. His
doubt is, whether he has to admit the rent amount, which he receives from his tenant, as service turnover in his GST or not ? Will the consequence vary according to the status of the occupant, viz. Commercial or Non-Commercial ?

Kindly advice.

ASHWANI DHANUKA

ASHWANI DHANUKA (Expert)
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17 February 2025 if the rent is from dwelling purpose (non commercial) then it is exempted. If the tenant uses for business purpose then GST is applicable @18%

Gopalakrishnan. S

Gopalakrishnan. S (Querist)
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18 February 2025 Thank you Sir. If the tenant is using the premises for Commercial purpose, then should the landlord raise an invoice for the rent from his existing business itself and subsequently admit the rent as service turnover in GST ?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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18 February 2025 yes. he/she should raise gst invoice as usual and that automatically gets added to his/her turnover.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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18 February 2025 however, forthe income-tax purposes, you will have to segregate the turnover for income from house property and business income.

Gopalakrishnan. S

Gopalakrishnan. S (Querist)
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18 February 2025 Thank you so much Sir.

ASHWANI DHANUKA

ASHWANI DHANUKA (Expert)
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18 February 2025 To add one more point- please ensure that SAC of Renting services has been added to you GSTIN. If not, it is suggested to amend suitably

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Gopalakrishnan. S

Gopalakrishnan. S (Querist)
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18 February 2025 Yes Sir, Thank you.

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