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Now 18% GST on Rent of Residential Property – New GST Rules Explained! - YouTube
Channel: Asset Yogi
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Friends, till now there was no GST on residential properties
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But from July onwards, GST has also started on residential properties
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What are these new rules?
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To whom will they affect?
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How much will they affect?
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We'll understand that in this video, stay tuned!
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So guys, these new rules say
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that GST will be levied on residential properties also
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are effective from 18th July 2022
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But before understanding these new rules
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you have to understand the existing rules
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That means those rules that were applicable till June
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Till now GST was not levied on residential properties
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Whether the landlord was GST registered or not
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Or whether the tenant was GST registered or not
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So till now, GST was only levied on commercial properties
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It will still be taxed,
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It is not like GST will not be
levied on commercial properties
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"Current rules are still applicable."
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So when is GST levied on a commercial property?
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It is levied when the landlord is GST registered.
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And when GST registration
becomes compulsory for the landlord?
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If their turnover is more than Rs.20 lakhs
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If they are providing services
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If their total income including rent is more than Rs.20 lakhs
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Then they have to take GST registration
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Or if they have Goods business
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In that case, if their turnover is more than Rs.40 lakhs
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Then they have to take GST registration
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This value is a little less for the North Eastern States
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If the services turnover is more than Rs.10 lakhs
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Then they have to take GST registration
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Or if the goods turnover is more than Rs.20 lakhs
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Then they have to take GST registration
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So, if any landlord is GST registered
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And they have given commercial property for rent
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Then they will charge GST to the tenant
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Whether the tenant is GST registered or not.
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He has to pay the GST
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And 18% GST is levied on rent
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So we've talked about
commercial properties & existing rules.
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Now let's talk about,
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How will residential properties be taxed with GST?
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Firstly it doesn't matter whether
the landlord is GST registered or not
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If the tenant is GST registered
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Then he/she has to pay GST
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The payment of GST
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is according to the Reverse Charge Mechanism.
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That means the tenant will pay
the GST directly to the government.
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He will not pay the GST to the landlord
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But some people may have a doubt here that,
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All the salaried people who take
a home or any property on rent
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Or any residential property
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Will they have to pay the GST?
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So let me clarify here
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That salaried class don't have to pay GST
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Only those who are GST registered
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Only they have to pay GST
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But who are GST registered?
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We've already talked about this
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Those who have business income
& are above the threshold
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GST registration is compulsory for them
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So the big question is,
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Who all will get affected by these new rules?
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For example, many companies take guest houses for rent
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They have to pay the GST on this rent
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Or if any company is taking any residential property
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Even if for their employees
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Then they have to pay GST on rent
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But if the employee directly takes that property on rent
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Then that employee doesn't have to pay GST on rent
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But as the company is GST registered
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So they have to pay the GST
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You might have seen in many residential properties
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There are small shops or businesses
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Someone may have shops on the ground floor & people are living above
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In such cases where any business is operating
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And if the tenant is GST registered
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Then they have to pay the GST
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Or if there is any online creator
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If they have taken a flat on rent
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And they shoot their videos there
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And if they are GST registered
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Then they also have to pay GST.
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Other than these, there are many business professionals
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Like CAs, Architects, Lawyers
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Or any business consultant
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If they are operating from any rented residential property
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And if they are GST registered
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Then they have to pay GST.
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Many people operate through
such rented residential properties
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Who were not in the ambit of GST till now
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Because many landlords are not GST registered
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As they might not have that much rental income
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Or business income
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So in short, if any GST-registered person
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Has taken any residential property on rent
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Then they have to pay the GST
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In your situation, is the GST applicable for you or not?
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Consult your CA or Tax consultant about that
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I think these new rules can affect many people
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And might be relevant to many people
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If you like the video then
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Do Like & Share
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If you think these new rules might affect someone
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Then do tell them
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Because GST applicability has been immediately done
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And they have to pay GST
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If they have taken any residential property on rent
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And if they have a GST registration.
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If you haven't subscribed to this channel yet
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Then Subscribe to it & Press the Bell Icon
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See you in the next informative video,
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Till then Keep Learning, Keep Earning
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And stay Happy as always.
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