For those of you… who were fortunate enough to get hold of their dream home from a developer…. Chances are this news will only bring some lines on your forehead.

As if increasing cost of living in metros wasn’t enough for the ordinary Ram & Rahim, another incidence is now of GST on the Monthly RWA Charges…. Read on to find out more about if, how and how much can it affect you….

Flat owners are now required to pay GST @ 18%, if their monthly maintenance fees to RWA is more than Rs 7,500.

As per the new rules, RWAs are now required to collect GST @ 18% on the monthly subscription charged from its residents, where such payment is more than Rs 7,500 per flat per month and the annual turnover of RWA also exceeds Rs 20 lakhs.

The point to note here is that “In case the charges exceed Rs 7,500 per month per member, the entire amount is taxable. For example, if the maintenance charges are Rs 9,000 per month per member, GST @18 per cent shall be payable on the entire amount of Rs 9,000 and not on (Rs 9,000-Rs 7,500) = Rs 1,500,” it said.

Scenario: How the tax liability would be calculated for a person who owns two or more flats in the housing society or residential complex,

XPERT View: In such cases the ceiling of Rs 7500 per month per member shall be applied separately for each residential apartment owned by him.

Eligibility for Input Tax Credit: RWAs will be 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.

Tax Consulting, Accounting & Bookkeeping Services