GST Applicability on Hostel Accommodations

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This discussion clarifies GST applicability on hostel accommodations based on recent notifications. It explores scenarios for direct billing to students/professionals and corporate bookings, differentiating between residential and commercial property types. The advice suggests 12% GST for certain residential properties and 18% for commercial ones, with specific HSN/SAC codes provided for rental and leasing services, particularly SAC 997211 for residential property rentals.

Gaurav Vij

Gaurav Vij (Querist)

19 July 2022 As per recent notification from GST, the hotels are required to charge 12% if the room rent is less than 1000 per day.

https://www.cnbctv18.com/economy/gst-council-meet-hotel-rooms-below-rs-1000-per-day-to-attract-12-percent-tax-13971862.htm

Scenario 1 - In case, we bill directly to Students or Working professional.
Property type - Residential
a. Does this apply to Hostels as well?
b. If No, what HSN/SAC code to be used for Rental invoices

Scenario 2 - In case, we bill directly to Students or Working professional.
Property type - Commercial
a. Does this apply to Hostels as well?
b. If No, what HSN/SAC code to be used for Rental invoices

Scenario 3 - In case, we bill directly to Private Limited companies who pay for their employees. Property type - Residential
a. What GST percentage we need to charge to the companies 12% or 18%.
b. Will this be exempt in this case?
c. What will be HSN/SAC code to be used.

Scenario 4 - In case, we bill directly to Private Limited companies who pay for their employees. Property type - Commercial
a. What GST percentage we need to charge to the companies 12% or 18%.
b. Will this be exempt in this case?
c. What will be HSN/SAC code to be used.

I would request your expert thoughts and directions on above scenarios

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

19 July 2022 1 No GST applicable in such a case.
2 GST applicable being comercial property.
3 18% GST applicable
4 18% GST applicable.

Gaurav Vij

Gaurav Vij (Querist)

20 July 2022 Thanks R Seetharaman sir, In that case what should be the HSN/SAC Code to be used for all of the above 4 scenarios.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

20 July 2022 SAC (Service Accounting Code) for rental & leasing falls under heading 9972. For rental or leasing services involving own or leased residential property fall under SAC code 997211.

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