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Notification 5/2022 GST

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Rajkumar Gutti

773 Points Posted on 20 July 2022

we are paying room rent to our employees other than their salary.
Is this rent treated for paying GST RCM under recent notification 5/2022 GST as residential dewelling

Replies (5)

Quick Summary

This discussion clarifies the applicability of GST Reverse Charge Mechanism (RCM) on room rent paid to employees, particularly concerning Notification 5/2022. If a company pays rent directly to a landlord based on a rent agreement in the company's name for an employee's residential dwelling, then GST RCM is applicable. The key factor is whether the rent agreement is executed between the company and the property owner.

prasad Nilugal

GST Practitioner & Accounts

8998 Points Posted on 20 July 2022

If tenant is registered under GST, then he has to pay GST under RCM for staying in residential dwelling .

Rajkumar Gutti

773 Points Posted on 20 July 2022

Here tenant is our our employee but rent paid by company & company is registered under gst

Kishor Lulla

656 Points Posted on 21 July 2022

Yes. to pay rcm

Rajkumar Gutti

773 Points Posted on 21 July 2022

First step is rent paid by employee to his landlord
Then company reimbursement rent to employee.
The said expenses is debited as Rent expenses in the company's books of account.
In above case can company is liable to pay gst on RCM basis. Company is registered under gst.

CA. ANKIT PANDYA

292 Points Posted on 21 July 2022

Check the rent agreement. In whose name the rent agreement is executed. Is it between company & property owner or is it between employee (in his personal capacity) and property owner.

if company has executed rent agreement then RCM applicable.