Understanding GST on Apartment Maintenance Charges

The Government of India has clarified the rules regarding Goods and Services Tax (GST) on monthly maintenance charges for apartments. Here’s what you need to know:

GST Exemption Limit

• Maintenance charges up to ₹7,500 per month per member are exempt from GST.
• If the charges exceed ₹7,500 per month per member, GST is applicable on the entire amount, not just the excess amount.

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GST Applicability

• GST registration is required for Resident Welfare Associations (RWAs) with an aggregate turnover of ₹20 lakh or more in a financial year.
• If the aggregate turnover is less than ₹20 lakh, RWAs are not required to register for GST or pay GST on maintenance charges, even if the charges exceed ₹7,500 per month per member.

Calculating GST Payable

• When maintenance charges exceed ₹7,500 per month per member, GST is chargeable on the entire amount.
• For example, if the maintenance charge is ₹9,000, GST is applicable on the entire amount of ₹9,000.

Additional Points to Note

• Multiple Apartment Ownership: If a person owns multiple apartments in the same society or residential complex, they are eligible for separate exemptions for each unit.
• Commercial Use of Flats: The exemption is available even when flats are occupied for commercial use, as long as they qualify as members of the RWA.
• Input Tax Credit: RWAs can claim input tax credit on GST paid on inputs and services used for making supplies to its members, such as capital goods, goods, and input services ¹ ².

GST Rate

• The applicable GST rate on maintenance charges is 18% ².