If you live in an apartment or a gated community, you pay monthly maintenance charges to your housing society or Resident Welfare Association (RWA). These charges cover common services like security, cleaning, electricity for common areas, waste management, and repairs. But do you know that GST (Goods and Services Tax) may be applicable on your maintenance charges?

1. When is GST Applicable on Maintenance Charges?

GST on maintenance charges applies only if both of the following conditions are met:

• RWA/Society’s annual collection exceeds 20 lakh – If the total collection of the society (from all residents combined) crosses 20 lakh in a financial year, it must register for GST.
• Monthly maintenance per flat exceeds 7,500 – If an individual flat owner pays more than 7,500 per month as maintenance, GST is applicable on the entire amount, not just the amount exceeding 7,500.
• If both conditions are met, GST is charged at 18% on the maintenance amount.
• If either condition is not met, GST is NOT applicable.

2. Examples of GST Calculation

Example 1: GST is Applicable

• Monthly maintenance per flat = 8,500

• Society’s total annual turnover = 30 lakh (Above ?20 lakh)

• GST @ 18% on 8,500 = 1,530

• Total amount payable = 8,500 + 1,530 = 10,030.

 Example 2: No GST (Charge Below 7,500)

• Monthly maintenance per flat = 7,000

• Society’s total annual turnover = 50 lakh (Above 20 lakh)

• Since the charge is below 7,500, no GST applies

• Total amount payable = 7,000 (No GST)

Example 3: No GST (Society’s Turnover Below 20 Lakh)

• Monthly maintenance per flat = 9,000

• Society’s total annual turnover = 18 lakh (Below 20 lakh)

• Since the turnover is below 20 lakh, no GST applies

• Total amount payable = 9,000 (No GST)

3. What Items in Maintenance Charges Attract GST?

 GST is applicable on:

• Security and housekeeping services

• Common area electricity and water charges

• Waste management

• Repairs and maintenance of common areas

• Parking charges (if collected by RWA)

• Clubhouse and facility usage fees (if applicable)

 GST is NOT applicable on:

• Property tax collected by the RWA (since it’s a government charge)

• Water charges collected separately (not part of maintenance)

• Electricity bills paid directly by residents to the government.

4. Special Cases & Exceptions

? What if Some Flats Pay Above 7,500 and Others Don’t?

• If some flats pay more than 7,500 while others pay less, GST applies only to the flats paying above 7,500.

• Flats paying 7,500 or less are completely exempt from GST.

 Does GST Apply to Sinking Fund & Corpus Fund?

• If a sinking fund (for future repairs) is charged monthly, it is subject to GST if the total charge exceeds 7,500.

• A one-time corpus fund collected from residents is NOT subject to GST.

 What About Rentals?

• If you own a flat and rent it out, maintenance charges will have GST if they exceed 7,500.

• The tenant will have to pay the GST along with the maintenance.

5. Can the Society Claim Input Tax Credit (ITC)?

Yes! If the society/RWA is registered under GST, it can claim Input Tax Credit (ITC) on:

• GST paid on purchases like security services, housekeeping, and maintenance supplies.

• This helps reduce the net tax liability, benefiting residents in the long run.

6. Final Summary – Do You Need to Pay GST?

7. How to Check Your GST Liability?

•  Check if your monthly maintenance exceeds 7,500.
•  Verify if your society’s annual collection is over 20 lakh.
•  If both conditions are met, expect 18% GST on your bill.
•  If either condition is NOT met, no GST is applicable.

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