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RCM Related to Rent

01 November 2024

Which tax payers are required to pay rent related RCM to the government. In which return and where to report it. Can RCM tax claim be taken? So when can claim be made? It is effective from the return of any month

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Rama chary Rachakonda (Master in Accounts & Lawyer email ID:ramachary64@gmail.com voice no:9989324294) (5686 Points)
Replied 01 November 2024

In the case of rent, the following taxpayers are required to pay RCM: -

Businesses with a turnover of more than ₹1 crore in the preceding financial year -

Individuals/Hindu Undivided Families (HUFs) paying rent above ₹2.4 lakh per annum They need to report it in: - GSTR-3B (Monthly/Quarterly Return) - GSTR-1 (Details of outward supplies) - GSTR-2A (Details of inward supplies)

The RCM tax paid can be claimed as input tax credit (ITC).

The claim can be made: - In the same month's return (GSTR-3B) -

Any subsequent month's return (GSTR-3B) Effective from the return of the month in which the rent was paid.

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Kishor Lulla (993 Points)
Replied 02 November 2024

Above amendment where and under which notification.

Sahil Jaiswal (Article Assistant) (1172 Points)
Replied 05 November 2024

For rent-related Reverse Charge Mechanism (RCM) under GST:

Who Pays RCM on Rent: Registered taxpayers renting commercial property from an unregistered person.
Reporting:
- Report RCM tax in GSTR-3B, Table 3.1(d) ("Inward supplies liable to reverse charge").
Claiming ITC:
- ITC can be claimed on RCM paid, provided it's for business purposes.
- Claim ITC in the same month’s return once RCM is paid.