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Rcm - on rent

RAJA P M ("Do the Right Thing...!!!") (128042 Points)

30 June 2017

Dear Experts and Guys...

Reply your Valuable knowledge for improvement.......

A Assessee give Factory Rent Rs. 780,000/annum.

Deduct TDS on Rent Rs. 78,000 last FY.

Now, GST Regime is Starting 01-Jul-2017 00:00:00......

The rent increase Rs. 70000...! I ll deduct TDS FY 2017-18. But,

How to I treat the Rent under GST...?

If the owner is not registered person Then this rent to fall RCM....?

If RCM applicable Rate on GST...?

If RCM applicable When I pay the Tax to GOV...?

When I reverse the ITC...?

Please send your valuable reply

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3 Replies

Vipul Maheshwari (Goods and Services Tax Consultant) (208 Points)
Replied 30 June 2017

1) Renting of immovable proeprty is taxable under GST

2) If owner is unregistered and reciepient is registered then section 9(4) of CGST Act,2017 apply

RCM applicable.

3) GST rate 18%

4) recipient will get credit of GST paid under RCM

5) date of payment (entered in books of accounts or debited in bank account)

day immediately aftre the expiry of 60days from the date of issue of invoice

whichever is earlier

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RAJA P M ("Do the Right Thing...!!!") (128042 Points)
Replied 30 June 2017

Thank You Sir...

Thank You for the reply....

Purnima (Professional) (289 Points)
Replied 30 June 2017

Assuming the assessee as per above example does not have any other suppliesi.e he is having income only in form of renting of immovable property,the person is not liable for registration and hence is unregistered.

Now if unregd person is renting his property to another unregistered person then GST under RCM shall not be applicable as sec 9(4) is applicable only when supplies are from unred person to regd person.

If rented to regd person then recipient shall pay GST under RCM.

Rate shall be same as applicable on renting of immovable property under forward charge i.e.18%.

Tax shall be paid by 20th of the next month from the month in which TOS triggers.TOS for services in case of RCM=Earlier of the following dates: a) payment; b) date immediately following 60 days of invoice date.

Reversal of ITC doesn't arise if supplier is unregistered and if he is registered then he shall take ITC.

Hope this helps!

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