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GST on RENT

08 July 2017

we are registered company under GST. we have taken on rent 3 godown from different people and the rent is 1.8 lakh, 3.0lakh & 1.0 lakh per annum respectively. all the landlord are not registered and below 20 lakh. what will be company position under GST?

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18 Replies

CA Akhilesh Kumar Kandpal (Proprietor A K Kandpal & Associates) (1442 Points)
Replied 08 July 2017

you have to pay GST on reverse charge basis.....

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rocky (accountant) (948 Points)
Replied 08 July 2017

yes. applicable... but composite dealer will pay RCM @ 1% without taking any input

CA Akhilesh Kumar Kandpal (Proprietor A K Kandpal & Associates) (1442 Points)
Replied 08 July 2017

big noooooooooo.....composition dealer will have to pay GST at regular rate in case of RCM......

Prabhat Kishanpuria (46 Points)
Replied 08 July 2017

Thanks for reply. we are regular registered . on all three people we should pay RCM?

CA Akhilesh Kumar Kandpal (Proprietor A K Kandpal & Associates) (1442 Points)
Replied 08 July 2017

whether regular or composition.....if you are registered and receive any goods and services from unregistered , than you have to pay GST at regular rate on that amount on RCM basis...

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CA Akhilesh Kumar Kandpal (Proprietor A K Kandpal & Associates) (1442 Points)
Replied 08 July 2017

whether regular or composition.....if you are registered and receive any goods and services from unregistered , than you have to pay GST at regular rate on that amount on RCM basis...

rocky (accountant) (948 Points)
Replied 08 July 2017

akhilesh sir, can you give proof .

CA Akhilesh Kumar Kandpal (Proprietor A K Kandpal & Associates) (1442 Points)
Replied 08 July 2017

if you read language of the section 10 than it first says that "subject to sub section (3) and (4) of section 9"....this establish that he has to pay tax on reverse charge basis on regular rate as sub section (4) of section 9 overrules section 10......second proof is that section 10 says "0.5%/1%/2%" of TURNOVER in the state or ut"....and you must have kno

rocky (accountant) (948 Points)
Replied 08 July 2017

thank you akhilesh sir

Dev Kumar (Accounts Manager) (107 Points)
Replied 08 July 2017

Can input be taken of such RCM paid?

What if I use half of property for persoal use and half for professional services?

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CA Akhilesh Kumar Kandpal (Proprietor A K Kandpal & Associates) (1442 Points)
Replied 08 July 2017

yes input can be take.....but credit will be available only for that part which is for the purpose of business.....in your case only half amount will be available for input credit......
But with little planning you can avoid tax on residential part.....you should make 2 separate contract with owner.....1 for business use between you and landowner.....2nd for residential purposes between your wife or mother (assuming she is not a registered person) and landowner....by doing this you have to pay GST on reverse charge only on the amount of rent paid for business use