Residential rent in gst

To Start with, Notification No.05/2022-C.T(R) dated 13th July, 2022 inserted Sl.No 5AA in Notification No.13/2017-C.T(R) dated 28th June, 2017 which specifies Recipient of Service as "Registered Person" and Supplier of Service as "Any Person". Hence to attract RCM, Service Provider need not to be "Unregistered Person" in our case specifically.

Later on, we have three notifications amending Notification No.13/2017-C.T(R) dated 28th June, 2017 dated 26th July,2023, 28th February, 2023 and 19th October, 2023 which did not amend Sl.No 5AA. For more certainity, I have verified whether any Notification had issued amending Notification No.05/2022-C.T(R). Nothing has found on my verification.

To sum-up, RCM is applicable even Service Provider is "Registered Person" in this particular case.

Further going in to the case, Your comapny (Registered one) has taken a Building on Rent from Registered Person and inturn let out it to the Employees for the purpose of the Residence.

Stage 1: Payment of Rent by Company to Landlord

Firstly, Services by way of Renting Residential Dwelling for use as a Residence "except where the residential dwelling is rented to a registered person" are Exempt at Sl.No 12 of Notification No.12/2017-C.T(R) dated 28th June, 2017. (Bold Part has been inserted by way of Notification No.04/2022-C.T(R) dated  13th July, 2022)

Hence, in the given case as Recipient of Service is a Registered Person (PVT LTD in your case), the benefit of exemption is not available when your company is paying rent to landlord. Consequently we have to check whether FCM or RCM applies.

To made RCM Applicable in this case, Service Recipient must be a Registered Person, Hence RCM Applicable.

Stage 2: Letting out to Employees on Rent 

In the given case, Residential Dwelling is let out on rent to Employees for the purpose of Residence, As Employees are "Unregistered", benefit of Sl.No 12 of Notification No.12/2017 is still applicable, Hence company need not to collect any GST on Rents received from Employees.

Finally to sum-up,
1. RCM applicable on Rent Payment to Landlord, 2. No GST on Rent collected from Employees and 3. As GST on Input Service (RCM) is exclusively used for providing exempt supplies, ITC not available.