Category - GST

GST

GST applicability on maintenance to Cooperative housing society

GST APPLICABILITY ON HOUSING SOCIETY

GST APPLICABILITY ON MONTHLY MAINTENANCE CHARGED BY COOPRTATIVE HOUSING SOCIETY IF MAINTENANCE ABOVE 7500/- PER MONTH.

Flat owners will have to pay GST at @18 percent if their monthly contribution to resident welfare association (RWA) exceeds Rs.7500/-. Resident Welfare Associations are required to collect GST on monthly subscription/contribution charged from its members if such payment is more than RS.7500/- per month per member. And only in the case of the annual turnover of the RWA (resident welfare association) by way of supply of goods & services exceeds Rs.20 lakh.

In a circular issued to clarify the applicability of GST on building maintenance charges, the ministry said that in case the charges exceed Rs.7500/- a month per member, the entire amount is subject to 18% GST, not just the amount in excess of Rs.7500/- the Finance Ministry said the exemption from GST on maintenance charges charged by an RWA from residents is available only if such charges do not exceed Rs.7500/- per month per member. Earlier, the maintenance charges in excess of ₹5,000 attracted GST and the limit was revised in excess of ₹7,500.

However a resident must pay GST on the value over and above ₹7,500 or on the entire amount. For example, if the maintenance charge is ₹8,000 for an individual resident, does GST liability arise on the value over and above ₹7,500 (on ₹500) or on the entire amount of ₹8,000? The GST is applicable on the entire amount i.e. on Rs.8000/-

 On how the tax liability would be calculated for a person who owns two or more flats in the housing society or residential complex, the Ministry said in such cases the ceiling of Rs.7500/- per month per member shall be applied separately for each residential apartment owned by him.

“For example, if a person owns two residential apartments in a residential complex and pays Rs.15000/-per month as maintenance charges towards the maintenance of each apartment to the RWA (Rs.7500/- per month in respect of each residential apartment), the exemption from GST filing shall be available to each apartment”.

And also RWAs are entitled to take input tax credit (ITC) of Goods and Services Tax (GST) paid by them on capital goods (generators, water pumps, lawn furniture etc.), goods (taps, pipes, other sanitary/hardware fillings etc.) and input services such as repair and maintenance services.