Whether to raise gst or not
This query is : Resolved
11 July 2017
I being an individual given a premises on rent below 20 Lakhs for residential purpose and i have also carrying Carry and forwarding agency services
Should i collect GST on Rent portion also ??
What is the answer if I gave rent for Commercial purpose
Should i collect GST on Rent portion also ??
What is the answer if I gave rent for Commercial purpose
CA R SEETHARAMAN
(Expert)
11 July 2017
For residential purpose no gst applicable. for commercial gst applicable.
11 July 2017
Sir that means GST will be applicable for total T.O irrespective of nature of business ??
03 August 2025
Let's clarify your GST query step-by-step:
Scenario:
You are an individual earning income from two sources:
Renting out premises (residential or commercial)
Carrying and forwarding agency services
Annual turnover from rent is below Rs. 20 lakhs
Question: Should you charge GST on rent portion? What if the rent is for commercial use? Does GST apply on total turnover irrespective of nature of business?
1. GST on Rent for Residential Purpose:
Residential Rent (for residential dwelling) is exempt from GST.
You do not need to collect GST on rent received for residential premises.
2. GST on Rent for Commercial Purpose:
Rent for commercial premises is taxable under GST.
You must collect GST on commercial rent if your total turnover exceeds the threshold limit.
3. Threshold Limit & Aggregation of Turnover:
GST registration and tax liability arise only if your aggregate turnover exceeds Rs. 20 lakhs (Rs. 10 lakhs in some special category states).
Aggregate turnover includes turnover from all business verticals, including rent and services.
So, you must aggregate income from carrying & forwarding agency + rent from commercial premises + any other business activity to check if turnover exceeds the threshold.
4. Summary:
Situation GST Applicability
Rent for residential purpose No GST applicable
Rent for commercial purpose GST applicable if aggregate turnover > Rs. 20 lakhs
Carrying & forwarding services GST applicable if turnover > Rs. 20 lakhs
Aggregate turnover for threshold Sum of all business income including rent and services
Example:
Rent (residential): Rs. 15 lakhs (No GST)
Rent (commercial): Rs. 5 lakhs
Carry & Forwarding services: Rs. 3 lakhs
Total turnover = Rs. 15 + 5 + 3 = Rs. 23 lakhs
Since aggregate turnover > 20 lakhs, GST registration is required and GST must be charged on commercial rent and forwarding agency services.
Scenario:
You are an individual earning income from two sources:
Renting out premises (residential or commercial)
Carrying and forwarding agency services
Annual turnover from rent is below Rs. 20 lakhs
Question: Should you charge GST on rent portion? What if the rent is for commercial use? Does GST apply on total turnover irrespective of nature of business?
1. GST on Rent for Residential Purpose:
Residential Rent (for residential dwelling) is exempt from GST.
You do not need to collect GST on rent received for residential premises.
2. GST on Rent for Commercial Purpose:
Rent for commercial premises is taxable under GST.
You must collect GST on commercial rent if your total turnover exceeds the threshold limit.
3. Threshold Limit & Aggregation of Turnover:
GST registration and tax liability arise only if your aggregate turnover exceeds Rs. 20 lakhs (Rs. 10 lakhs in some special category states).
Aggregate turnover includes turnover from all business verticals, including rent and services.
So, you must aggregate income from carrying & forwarding agency + rent from commercial premises + any other business activity to check if turnover exceeds the threshold.
4. Summary:
Situation GST Applicability
Rent for residential purpose No GST applicable
Rent for commercial purpose GST applicable if aggregate turnover > Rs. 20 lakhs
Carrying & forwarding services GST applicable if turnover > Rs. 20 lakhs
Aggregate turnover for threshold Sum of all business income including rent and services
Example:
Rent (residential): Rs. 15 lakhs (No GST)
Rent (commercial): Rs. 5 lakhs
Carry & Forwarding services: Rs. 3 lakhs
Total turnover = Rs. 15 + 5 + 3 = Rs. 23 lakhs
Since aggregate turnover > 20 lakhs, GST registration is required and GST must be charged on commercial rent and forwarding agency services.
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