Gst on Commission earned by rela estate agent

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Dimpy

Accounts

96 Points Posted on 06 February 2023

Hello

Is any Businessman (proprietor) who is GST registered, earning commission or brokerage for sale of property then is he required to raise a gst invoice? if yes, then how much %. Also is any alteration required in GST certificate as initially only trading of goods is mentioned in the certificate?

Thank you

Dimpy

Replies (6)

Quick Summary

This discussion clarifies the Goods and Services Tax (GST) implications for real estate agents earning commission. It confirms that agents must charge and pay 18% GST on their commission income and issue a GST invoice. For NRI sellers, the responsibility for paying GST on the agent's commission lies solely with the real estate agent, not the seller. It's advisable for sellers to ensure the agent is GST registered and to obtain a proper GST invoice.

Aisha

Finance Professional

13517 Points Posted on 06 February 2023

Yes, invoice can be raised.
GST rate for services, including commission or brokerage services, is 18%

CA Altamush Zafar

GST Consultant

10402 Points Posted on 06 February 2023

Yes invoice has to be raised with gst 18%. If it's a regular business then add the same in your registration by amending non-core fields

CA Rashmi Gandhi

Chartered Accountant

44487 Points Posted on 06 February 2023

You have to pay GST @ 18% on commission amount. Add new service of commission in GST certificate

Sandhya Ranjit

25 Points Posted on 22 August 2024

I am an NRI selling property in India. My real estate agent is asking me to ay a gst of 18% on the commission. Should I as a seller pay this GST on the commission amount? Or the real estate agent should be paying it himself? Your professional inputs will be much appreciated. Thank you. Sandhya

Rama chary Rachakonda

Master in Accounts & high court Advocate

7021 Points Posted on 23 August 2024

As an NRI seller, you are not liable to pay GST on the commission amount. The real estate agent should pay the GST on their commission themselves. Here's why: 1. _Agent's income_: The commission earned by the real estate agent is their income. 2. _GST applicability_: GST is applicable on the agent's income, not on the property sale. 3. _Agent's responsibility_: The agent is responsible for paying GST on their commission. 4. _Section 2(105) of CGST Act_: Defines "supplier" as the person who supplies goods or services. In this case, the agent is the supplier of services. 5. _Notification No. 13/2017-Central Tax (Rate)_: Specifies that services provided by real estate agents are liable for GST. 6. _FAQs by CBIC_: Clarify that the agent is responsible for paying GST on their commission. Ensure you have a clear agreement with the agent, and they should provide you with a GST invoice for their commission. Verify the agent's GST registration and compliance to avoid any issues.