HSN- Rent Commercial property

SAC 997212 Rental or leasing services involving own or leased non-residential property

This service code includes:

rental or leasing services concerning industrial, commercial or other non-residential buildings or property by owners or leaseholders, such as factories, office buildings, warehouses, theatres, convention centres, exhibition halls and multiple-use buildings that are primarily non- residential; agricultural, forestry and similar properties.

rental or leasing of caravan sites, lock-up garages or other places for parking vehicles, by the month or year

Note: 997211 relates to residential property

SAC 997212 is correct (997211 is for residential). GST is 18%. Key updates:

• RCM on commercial rent: from 10 October 2024, if an unregistered landlord lets commercial property to a registered tenant, the tenant pays 18% GST under RCM (Notf 09/2024-CT(R)). From 16 January 2025, composition-scheme tenants are excluded (Notf 07/2025-CT(R)).

• Landlord registration threshold: Rs 20 lakh (Rs 10 lakh in special category States).

• Residential property rented to a registered person for business use: RCM applies here too (since 18 July 2022). Rent to a proprietor using it as his own residence is exempt.

• TDS on rent: Sec 194I at 10% for land/building, threshold Rs 50,000 per month or part of a month (from 1 April 2025). Individual/HUF tenants not under audit deduct under Sec 194-IB at 2% (from 1 October 2024). TDS is on rent excluding GST.

• From 1 April 2026, TDS is under Sec 393 of the Income-tax Act, 2025.