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GST and Residential Rent topic

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GST Doubt

mcom

21 Points Posted on 03 June 2023

Current State : I (Tax Payer) applied for GST Under Rent category, So I am asked to submit an rental agreement. My landlord is not a registered person.

Question 1 : Who has to pay 18% rental tax ?

Question 2 : If Me (tax payer), should I still pay this 18% rental tax, if I file Nil returns(zero returns)

Question 3. Any Exemption is there from this? (Since I am a new Starter )

Replies (4)

Quick Summary

This discussion clarifies GST implications for residential rent. If you're a registered tenant renting a residential property for commercial purposes, you're likely liable to pay 18% GST under the Reverse Charge Mechanism (RCM), regardless of whether your landlord is registered. Exemptions may apply for new starters below the registration threshold, but once registered, GST is generally applicable on outward supplies.

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

121521 Points Posted on 03 June 2023

The query is not clear about the type of property, residential or commercial etc.

If commercial, the owner should charge GST if registered.

For new starters there is basic exemption limit; but once registered you have to charge GST over your outward supplies and pay the same to Government. You can get ITC benefit if its available with your output supply.

Pankaj Rawat

GST Practitioner

29904 Points Posted on 03 June 2023

It's no matter whether the property is residential or commercial when it is rented out for commercial purposes.

The threshold limit in term of Section 22 to obtain registration is 20 lac.

1. When it is residential property & rented out for commercial purposes. :
As per Notification no. 05/2022 as amended by Notification 15/2022 CT rate : Where the tenant is registered
When a tenant is registered and takes a residential property on rent from any person (registered or unregistered person) GST will be applicable under RCM. Liability to pay GST @ 18% will be of the recipient (tenant/lessee) of service.