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GST on Rent on Residential and Commercial Property: The Conclusion

There is lot of confusion and chaos among landlord and tenants in case of applicability of GST on Rent on Residential Property. This article will clear all your doubts and bring clarity with reference to the relevant sections and notifications. 

Edited on 13.08.2022

No GST on residential rents even if prop. of firm is registered in GST: PIB Tweets

Notification Vs. Tweet

As per PIB Tweet - No GST is applicable even if proprietor or partner of firm rents residence for personal use. (However there is no such provision in the RCM notification issued. A detailed clarification or circular should be issued by CBIC in this regard.)


(tweet link given below)

Table of Contents:

GST on Residential Property?

Q) Who is liable to pay GST on rent on Residential Property?

Q) What will be the rate of GST?

Q) Whether all tenants are liable to pay GST on Residential Property?

Q) Whether Landlord is liable to take registration under GST for rent received on Residential Property?

Q) Can Landlord pay GST under forward charge if he is also registered in GST and ask tenant not to pay GST under RCM?

Q) Can tenant claim input of GST paid under RCM on rent on Residential Property?

GST on Commercial Property?

Q) Who is liable to pay GST on rent on Commercial Property?

Q) What will be the rate of GST?
 
Q) Whether all Landlords are liable to pay GST on Commercial Property?
 
Q) Whether all Landlords are liable to take registration under GST?

Q) Can Tenant claim input of GST paid to landlord on commercial Property?

(A) GST on Rent on Residential Property

A new entry no. 5AA in RCM Notification No.13/2017 - CT(R) has been inserted vide Notification No.05/2022 - CT(R) w.e.f. 18/07/2022 to provide GST on rent on residential property under reverse charge.

Q) Who is liable to pay GST on rent on Residential Property?

Tenant (i.e. Recipient) is liable to pay GST on rent on Residential property as per RCM Notification No.13/2017 - CT(R) as amended vide Notification No.05/2022 - CT(R).
 
There is no such liability on Landlord to pay GST on rent on Residential Property in any case. 
 
Q) What will be the rate of GST?
 
18%. 
 
Q) Whether Landlord is liable to take registration under GST for rent received on Residential Property?
 
As per Section 23(2) of CGST Act read with Notification No.05/2017 - CT, Landlord is exempt from requirement of GST Registration in such cases.

Q) Whether all Tenants are liable to pay GST under reverse charge on Rent on Residential Property?
 
No, only those tenants who are registered in GST are liable to pay GST on rent of Residential Property. Other tenants like salaried employees or small businessman not registered in GST are not .......
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Author:

TaxReply


Aug 13, 2022

Comments


1) I AM A REGISTERED PERSON AND MY BUSSINESS PLACE IS RENTAL AND MY LAND LORD IS UNREGISTERED PERSON. THIS THIS CASE WHETHER I HAVE TO GST UNR RCM AND TAKE CREDIT OR FOR COMMERCIAL PROPERTY THIS CHANGES ARE NOT APPLICABLE PLEASE EXPLAIN ABOUT THIS.
2) PLEASE GUIDE US ABOUT RECENTLY CHANGES IN GSTR 3B
By: Shivaji Khopade | Dt: Aug 3, 2022
↳
Replied to SHIVAJI KHOPADE
RCM is not applicable on commercial property. If landlord is not registered, then you need not to pay RCM.
By: Taxreply | Dt: Aug 9, 2022
↳
Replied to TaxReply
What if the landlord is a NRI giving lease rent to a registered entity for commercial use
By: Bks | Dt: Mar 7, 2023
For commercial let out, if landlord is unregistered & its turnover is below 20 lakh, no gst will be applicable
In gstr 3b
3.1(1) is introduced sale by ecommerce operator mentioned in sec 9(5) has to put their sale as they have to pay tax on it resturant has to mention sale in their 3b under 3.1(1) b no tax to be paid, not for amazon, flip cart etc
Change in table 4 also
By: Manohar Mehra | Dt: Aug 4, 2022
↳
Replied to Manohar Mehra
Thank you for your clarification.
By: Taxreply | Dt: Aug 9, 2022
I am a proprietor of CA Firm. I am paying monthly rent of Rs.22000/- for a house where I am residing. Not doing any business activity form there. Can I be liable to pay GST under RCM.
By: Arun Kumar | Dt: Aug 8, 2022
↳
Replied to Arun Kumar
If you are registered under GST, then yes you are liable to pay GST under RCM. That's what the amendment is.
By: Taxreply | Dt: Aug 9, 2022
↳
Replied to Arun Kumar
As per PIB Tweet - No GST is applicable even if proprietor or partner of firm rents residence for personal use. (However there is no such provision in the notification issued. A detailed clarification or circular should be issued by CBIC in this regard.)
By: Taxreply | Dt: Aug 13, 2022
↳
Replied to Arun Kumar
If CA firm is registered under Gst than Gst under reverse charge to be paid , if property is for residential purpose otherwise not
By: Manohar Mehra | Dt: Aug 14, 2022
↳
Replied to Arun Kumar
you are not require to pay GST if you are using a residential property for personal use.
By: Gaurav Rajauriya | Dt: Nov 16, 2022
↳
Replied to TaxReply
Can he eligible to claim ITC
By: Jatin Mehta | Dt: Aug 13, 2022
↳
Replied to Jatin mehta
ITC can be claimed, if the premises is used for business purpose only.
By: Taxreply | Dt: Aug 13, 2022
↳
Replied to Jatin mehta
Yes, once Gst paid under reverse charge can claim RCM
By: Manohar Mehra | Dt: Aug 14, 2022
Room rent paid by the company for rooms provided to its employee, GST payable or not? (Company is registered under GST but Landlord is not registered)
By: Naveen Pathak | Dt: Aug 20, 2022
Company register under GST and provide to residence employee and recover rent in that RCM is applicable or not.
By: Pokharkar Vilas | Dt: Aug 21, 2022
one of my client has taken Composition Tax NUmber, does he need to pay GST on rent under RCM?
By: Aadi Walia | Dt: Aug 21, 2022
A company registered under GST has taken a property on rent from an unregistered person. The property is a residential property however the agreement between the parties clearly states that the property is being used for business purpose and also the registered person has a trade licence for the place.
Whether GST under RCM be applicable on the registered person?
By: Shrey Roongta | Dt: Sep 8, 2022


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