GST on Renting of Property : Analysis

By | April 30, 2018
(Last Updated On: April 30, 2018)

GST on Renting of Property

Analysis of GST on Renting of Property in India

Is there any GST on Renting of Property ?

yes,

As per Section 2(102) of CGST act 2017  “services” means anything other than goods, money and securities but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged;

Service Accounting Code for Renting or leasing services is under group 99721(Real estate services involving owned or leased property)

997211: Rental or leasing services involving own or leased residential property

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

997213: Trade services of buildings

997214: Trade services of time-share properties

997215: Trade services of vacant and subdivided land

What are the rates of GST on Renting of Property ?

GST rates for Real estate Services  :CGST  9% & SGST  9% / IGST 18%

[ As per Sr No 16 of Notification No 11/2017 Central Tax (Rate) Dated 28th June 2017  and Notification No 8/2017 Integrated Tax (Rate) Dated 28th June, 2017 : refer Link in this Video Description  ]

Is there any Exemption under GST on Renting of Property ?

GST Exemption has been provided to :-

“Services by way of renting of residential dwelling for use as residence

renting in relation to immovable property” means allowing, permitting or granting access, entry, occupation, use or any such facility, wholly or partly, in an immovable property, with or without the transfer of possession or control of the said immovable property and includes letting, leasing, licensing or other similar arrangements in respect of immovable property; [ Para 2(zz) of Notifications 12/2017 CT ( R) and 9/2017  IT ( R) ]

[ As per Sr No 12 of Notification No 12/2017 Central Tax (Rate) Dated 28th June 2017  and Notification No 9/2017 Integrated Tax (Rate) Dated 28th June, 2017 : Refer Link in this Video Description  ]

Is there any Exemption under GST on Renting of Property by religious place ?

GST Exemption has been provided to :-

Services by a person by way of
“ renting of precincts of a religious place meant for general public, owned or managed by an entity registered as a charitable or religious trust under section 12AA of the Income-tax Act, 1961 (hereinafter referred to as the Income-tax Act) or a trust or an institution registered under sub-clause (v) of clause (23C) of section 10 of the Income-tax Act or a body or an authority covered under clause (23BBA) of section 10 of the said Income-tax Act:

[ As per Sr No 13 of Notification No 12/2017 Central Tax (Rate) Dated 28th June 2017  and Notification No 9/2017 Integrated Tax (Rate) Dated 28th June, 2017 : Refer Link in this Video Description  ]

Note :

This exemption shall not apply to,—

(i) renting of rooms where charges are Rs 1 000 or more per day;

(ii) renting of premises, community halls, kalyanmandapam or open area, and the like where charges are Rs 10,000 or more per day;

(iii) renting of shops or other spaces for business or commerce where charges are Rs 10,000 or more per month.

“general public” means the body of people at large sufficiently defined by some common quality of public or impersonal nature; [ Para 2(zc)]

Is there any Exemption under GST for Upfront amount paid for long term lease of industrial plots?

Till 12.10.2017 This exemption  was as follow  :

One time upfront amount (called as premium, salami, cost, price, development charges or by any other name) leviable in respect of the service, by way of granting long term (thirty years, or more) lease of industrial plots, provided by the State Government Industrial Development Corporations or Undertakings to industrial units.”

w.e.f 13.10.2017 : GST Exemption has been provided to :-

Upfront amount (called as premium, salami, cost, price, development charges or by any other name) payable in respect of service by way of granting of long term lease of thirty years, or moreof industrial plots or plots for development of infrastructure for financial business, provided by the State Government Industrial Development Corporations or Undertakings or by any other entity having 50 per cent or more ownership of Central Government, State Government, Union territory to the industrial units or the developers in any industrial or financial business area.

[ As per Sr No 41 of Notification No 12/2017 Central Tax (Rate) Dated 28th June 2017  and Notification No 9/2017 Integrated Tax (Rate) Dated 28th June, 2017 : Refer Link in this Video Description  ]

Who has to pay GST on Renting of Property by Govt

Recipient of services.. that is the person paying the rent (if the person is registered under GST)

Notification No 3/2018 Union Territory Tax (Rate) : renting of immovable property by Govt to Registered Person : GST on RCM basis

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