We are local authority. Till now, we were collecting and depositing GST on our assets given on rent by us. Now, we are planning to give a contract to a agency in which agency will pay a lump sum amount to us and it will retain rent on property collected from public on assets owned by us. My query is whether GST would be applicable on lump sum payment received from agency ? If yes, whether under RCM or we should collect the same and deposit to government?
12 Replies
Ruchika Somani
(Coaching and Practice in Tax Audit Law.)
(4429 Points)
Replied 30 June 2018
GST wont b applicable.
That income you can show under income from business under No account case.
Or show as commission to which TDS will be applicable.
Ritesh
(Professional)
(291 Points)
Replied 30 June 2018
We are local authority. We don't have business. Whether commission is not covered under GST?
Ruchika Somani
(Coaching and Practice in Tax Audit Law.)
(4429 Points)
Replied 30 June 2018
It is. Your Commission bill will be inclusive of GST
Ritesh
(Professional)
(291 Points)
Replied 30 June 2018
Ok, it will be under the ambit of GST. Now question is who will pay, agency under RCM or us as loca authority?
Ruchika Somani
(Coaching and Practice in Tax Audit Law.)
(4429 Points)
Replied 30 June 2018
You will only have to pay it as you are charging it and collecting it.
Ritesh
(Professional)
(291 Points)
Replied 30 June 2018
What about notification 13-2017 (Central Tax - Rate) dated 28-06-2017?
Ruchika Somani
(Coaching and Practice in Tax Audit Law.)
(4429 Points)
Replied 30 June 2018
Yes, if u show it as commission income then u dont have to pay GST it means it will be on RCM basis.
If u show it as rental income then u have to pay GST
Ritesh
(Professional)
(291 Points)
Replied 30 June 2018
Whether lump sum amount received from agency can be shown as rent income from renting of immovable property?
Ruchika Somani
(Coaching and Practice in Tax Audit Law.)
(4429 Points)
Replied 30 June 2018
Yes it can be shown as rental income, however TDS if attracted need to be paid and return filed monthly of same.
Ritesh
(Professional)
(291 Points)
Replied 30 June 2018
Whether you are confused or making me confused. First you said it is commission income now you said it is rental income? Whether it is any of them, i think only RCM will apply?
Please consider notification no. 3/2018 (central tax rate) dated 25.01.2018
Ruchika Somani
(Coaching and Practice in Tax Audit Law.)
(4429 Points)
Replied 02 July 2018
Yes, RCM will apply in this case.
Ritesh
(Professional)
(291 Points)
Replied 02 July 2018
Thanks for your valuable time for this topic.
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