Renting on immovable property

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Avinash Vithalrao Kulkarni

Avinash Vithalrao Kulkarni (Querist)
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13 October 2011 Can We avail credit on Rent of Guest House ?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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16 October 2011 My view, it is not related to Business, so cannot avail credit

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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21 July 2025 Regarding input tax credit (ITC) on rent of guest house under GST or service tax:

Under GST:
Input Tax Credit on Rent of Guest House:

ITC can be claimed on rent paid for guest house only if the guest house is used in the course or furtherance of business.

If the guest house is used exclusively for business purposes (like accommodation for employees, clients, or business guests), ITC is allowed.

If the guest house is used partly for business and partly for personal use, ITC can be claimed proportionately.

ITC is not allowed on rent if the guest house is used for personal use or non-business activities.

Under Service Tax (pre-GST):
Credit on rent paid for guest house:

Service tax credit was available if the guest house was used for business purposes.

If guest house was used partly for personal and partly for business, credit was allowed proportionately.

Important:
Ensure the supplier (landlord) charges GST on rent, otherwise ITC cannot be claimed.

Maintain proper documentation and agreements specifying the use of the guest house for business.

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