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Gst on Rent


Mohit (Others)     29 July 2020

Mohit
Others 
 2 likes  68 points

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Restaurant paying 5% GST and running business in rented premises, is restaurant liable to pay gst in rent under RCM and if yes may that claim ITC of GST on rent

Sandeep shetty (Sr Accountant)     29 July 2020

Sandeep shetty
Sr Accountant 
 15 likes  199 points

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Restaurant service attracts 5% gst subject to not taking ITC

and RCM has to be paid on rent 

However ,hotels which charge above Rs 7500 per day for accommodation would be paying GST at 18% on restaurant services by availing ITC. In such cases, ITC on rent paid can be taken.

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Sagar Patel (Tax and Business Consultant)     29 July 2020

Sagar Patel
Tax and Business Consultant 
 356 likes  4147 points

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Yes, Restaurant paying 5% GST under composition and running business in rented premises, than that restaurant liable to pay gst on rent under RCM.
As you are composition dealer you can not claim ITC of GST on rent paid under RCM.

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CA ABHAY GUPTA (Practice)     29 July 2020

CA ABHAY GUPTA
Practice 
 220 likes  2447 points

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@ sandeep shetty ji and @ sagar patel ji, kindly provide circular or notices or any other thing who give light on thing that restaurant needs to pay GST on rent through RCM..

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Sagar Patel (Tax and Business Consultant)     29 July 2020

Sagar Patel
Tax and Business Consultant 
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Extract of Section 10, Composition scheme for reference

"Sec 10. (1) Notwithstanding anything to the contrary contained in this Act but subject to
the provisions of sub-sections (3) and (4) of section 9,"

Composition schemes benifit is available subject to provisions of sub-sections (3) and (4) of section 9,"
So, provisions of sub-sections (3) and (4) of section 9," is applicable to composition dealer also as same like normal dealer.
Composition has required to pay all RCM like normal scheme person.

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CA ABHAY GUPTA (Practice)     29 July 2020

CA ABHAY GUPTA
Practice 
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Agree but rent is neither covered by 9(3) nor by 9(4)

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Sagar Patel (Tax and Business Consultant)     29 July 2020

Sagar Patel
Tax and Business Consultant 
 356 likes  4147 points

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Agree with CA abhay Gupta ji
RCM is not applicable in this case.
Thanks for clarification 😊

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Mohit (Others)     30 July 2020

Mohit
Others 
 2 likes  68 points

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Thanks all for reply


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