GST Rate on services

  GST@ 0% ON SERVICES

(1) Carrying out an intermediate production process as job work in relation to cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for food, fiber, fuel, raw material or other similar products or agricultural produce.

(2) Services relating to cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for food, fiber, fuel, raw material or other similar products or agricultural produce by way of -----------------------

(a) services by any Agricultural Produce Marketing Committee or Board or services provided by a commission agent for sale or purchase of agricultural produce.

(b) processes carried out at an agricultural farm including tending, pruning, cutting, harvesting, drying, cleaning, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and make it only marketable for the primary market. Renting or leasing of agro machinery or vacant land with or without a structure incidental to its use

(c) loading, unloading, packing, storage or warehousing of agricultural produce.

(d) Agricultural extension services.

(3) Services by a foreign diplomatic mission located in India 

(4) Services by way of pre-conditioning, pre-cooling, ripening, waxing, retail packing, labelling of fruits and vegetables which do not change or alter the essential characteristics of the said fruits or vegetables.

(5) Services provided by the National Centre for Cold Chain development under the Ministry of Agriculture, Cooperation and Farmer's welfare by way of cold chain knowledge dissemination

(6) Services by a foreign diplomatic mission located in India

(7) Services provided by the Central Government, State Government, Union territory or local authority by way of assignment of right to use any natural resource where such right to use was assigned by the Central Government, State Government, Union territory or local authority before the 1st of April 2016; Provided that the exemption shall apply only to tax payable on one time charge payable. In cull upfront or in installments, for assignment of right to use such natural resource.

(8) Services provided by the Central Government, state Government, Union territory by way of deputing officers after office hours or on holidays for inspection or container stuffing or such other duties relation to import export cargo on payment of Merchan Overtime charges.

(9) Taxable services provided or to be provided, by a Technology Business Incubator or a science and Technology Entrepreneurship Park recognized by; the National Science and Technology Entrepreneurship Development Board of the Department of Science and Technology, Government of India or bio-incubators recognized by the Biotechnology Industry Research Assistance Council, under the Department of Biotechnology, Government of India.

(10) Services by an organizer to any person in respect of a business exhibition held outside India

(11) Services by way of collecting or providing news by an independent journalist, press Trust of India or United News of India

(12) Services provided by the Goods and Services Tax Network to the Central Government or State Governments or Union territories for implementation of Goods and Services Tax

(13) Services provided by a tour operator to a foreign tourist in relation to a tour conducted wholly outside India

(14) Services of public libraries by way of lending of books, publications or any other knowledge- enhance content or material.

(15) Services by way of sponsorship of sporting events organized - 

(a) by a national sports federation, or its affiliated federations, where the participating teams or individual represent any district, State, zone or Country.

(b) by the Central Civil Services Cultural and Sports Board.

(c)  as part of national games, by the Indian Olympic Association; or under the panchayat Yuva Kreed Aur keel Abhiyaan scheme.

(d) by association of Indian Universities, Inter- University Sports Board, Schol games Federation of India, All India Sports Council for the Deaf, Paralympic committee of India or Special Olympics Bharat.

(16) Services provided by the Central Government, State Government, Union territory or local authority by way of assignment of right to use natural resources to an individual farmer for cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for food, fiber, fuel, raw material or other similar products.

(17) Services by a specified organization in respect of a religious pilgrimage facilitated by the Ministry of External Affairs, the Government of India, under bilateral arrangement.

(18) Services provided by the Central Government, State Government, Union Territory or local authority by way of issuance of passport, visa, driving license, birth certificate or death certificate.

(19) Services provided by the Central Government, State Government, Union territory or local authority by way of issuance of passport, visa, driving license, birth certificate or death certificate.

(19) Services provided by the Indian Institutes of Management, as per the guidelines of the Central Government, to their students, by way of the following educational programmers, except Executive Development program: -

(a) two-year full time post Graduate Programs in Management for the Post Graduate Diploma in Management, to which admissions are made on the basis of common Admission Test (CAT) conducted by the Indian Institute of Management.

(b) five-year integrated programmer in Management.

(c) fellow program me in Management.

(20) Services provided to a recognized sports body by -------

(a) an individual as a player, referee, umpire, coach or team manager for participation in a sporting event organized by a recognized sports body'

(b) an individual as a player, referee, umpire, coach or team manager for participation in a sporting event organized by a recognized sports body.

(21) Services provided - (a) by an educational institution to its students, faculty and staff.

(b) to an educational institution, by way of (1) transportation of students, faculty and staff. (ii) catering, including any mid-day meals scheme sponsored by the Central Government, State Government or Union territory. (iii) security or cleaning or house- keeping services performed in such educational institution; (iv) services relating to admission to, or conduct of examination by such institution; up to higher secondary:

Provided that mothing contained in entry (b) shall apply to an educational institution other than an institution providing services by way of pre-school education and education up to higher secondary school or equivalent.

(22) Services by an artist by way of a performance in folk or classical art forms of MUSIC, DANCE, & THEATRE if the consideration charged for such performance is not more than one lakh and fifty thousand rupees:

Provided that the exemption shall not apply to service provided by such artist as a brand ambassador.

Services by way of - (a) health care services by a clinical establishment, an authorized medical practitioner or paramedics. (b) services provided by way of transportation of a patient in an ambulance, other than those specified in (a) above

Service by an unincorporated today or a non- profit entity registered under any law for the time being in force, to its own members by way of reimbursement of charges or share of contribution (1) up to an amount of five thousand rupees per month per member for sourcing of goods or services from a third person for the common use of its members in housing society or a residential complex.

Services by way of admission to a museum, national park, wildlife sanctuary, tiger reserve or zoo.

Services by way of public conveniences such as provision of facilities of bathroom, washrooms, lavatories, urinal or toilets.

Services provided by operators of the common bio-medical waste treatment facility to a clinical establishment by way of treatment or disposal of bio- medical waste or the processes incidental thereto.

Services by the Central Government or State Government or any local authority by way of any activity in relation to a function entrusted to a panchayat under article 243G of the Constitution is neither a supply of goods not a supply of service

Services provided to a foreign diplomatic mission or consular post in India or for personal use or for the use of the family members of diplomatic agents or career consular officers posed therein, is exempt by way of refund.

Services by way of training or coaching in recreational activities relating to: (1) sport by charitable entities registered under section 12AA of the Income -tax Act. & arts or culture

Services by way of right to admission to 

(a) circus, dance, or theatrical performance including drama or ballet.

(b) award function, concert,pageant,musical performance or any sporting event other than a recognized sporting event.

(c) recognized sporting event, where the consideration for admission is not more than Ts 250 per person as referred to in (a), (b) and (c) above.

GST on Services @ 5% with ITC of input services

(1) Transport of goods in a vessel

(2) Transport of passengers by rail in first class or air-conditioned coaches

(3) Transport of passengers by air in economy class

(4) Leasing of aircrafts by a scheduled airlines for scheduled operations 

(5) Transport of passengers, by air, embarking from or terminating in a Regional Connectivity Scheme Airport

(6) Transport of goods in a vessel

(7) Services provided by foreman of chit fund in relation to chit

GST on Services @ 5% No ITC 

(1) Services of goods transport agency (GTA) in relation to transportation of goods (including used household goods for personal use)

(2) Renting off motor cab where the cost of fuel is included in the consideration charged from the services recipient

(3) Transport of passenger, by---- (a) air-conditioned contract carriage other than motor cab;(b) radio taxi (c) air-conditioned stage carriage.

(4) Supply of tour operators' services

GST on Services @ 5% 

(1) Selling of space for advertisement in print media

(2) Services by way of job work in relation to -------------------------------------

(a) Cut and polished diamonds; precious and semi-precious stones; or plain and studded jewellery of gold and other precious metals, falling under Chapter of HSN.

(b) Processing of hides, skins and leather falling under Chapter 41 of HSN

(c) Printing or newspapers.

(d) Textile yarns (other than of man-made fibers) and textile fabrics.

(e) printing of books (including Braille books), journals and periodicals.

GST on Services @ 12% 

(a) Supply of food/drinks in restaurant not having facility of air-conditioning or central heating at any time during the year and not having license to serve liquor

(b) Temporary or permanent transfer or permitting the use or enjoyment of Intellectual Property (IP) right in respect of goods tother than Information Technology software.

(c) Accommodation in hotels,inns,guest house, clubs, composites or other commercial places meant for residential or loading purposes having room tariff Rs. 1000 and above but less than Rs. 2500 per room per day

(d) Transport of passengers by air in other than economy class.

(e) Transport of goods in containers by rail by any person other than Indian Railways.

GST on Services @ 12% with ITC of input services

(a) Services provided by foreman of chit fund in relation to chit

GST on Services @ 12% with no refund of accumulated ITC

(a) Construction of a complex, building, civil structure or a part thereof, intended for sale to a buyer, wholly or partly (the value of land is deemed to be one-third of the total amount charged for such supplies)

GST on Services @ 18% 

(a) Bundled service by way of supply of foods or any other article of human consumption or any drink, in a premises (including hotel, convention center, club, Andal, shamiana or any other place, specially arranged for organizing a function) together with renting or such premises

(b) Services by way of admission to exhibition of cinematograph films where price of admission ticket is one hundred rupees or less.

(c) Supply of Food/drinks in restaurant having license to serve liquor

(d) supply of food/drinks in restaurant having facility of air-conditioning or central heating at any time during the year

(e) Supply of Food/drinks in outdoor catering

(f) Accommodation in hotels, inns, guest houses, clubs, composites or other commercial places meant for residential or loading purposes where room tariff or Rs 2500/-and above but less than Rs 7500 per room day

(g) Services by way of admission or access to circus, India classical dance including folk dance, theatrical performance, drama

(h) Composite supply of Works contracts as defined in clause 119 of section 2 of CGST Act

(I) All other services not specified elsewhere

GST on Services @ 28% 

(a) Services provided by a race club by way of totalizator or a license to book maker in such club

(b) Services by way of admission to entertainment events or access to amusement facilities including exhibition of cinematograph films, theme parks, water parks, joy rides, merry-go rounds, go-carting, casinos, racecourse, ballet, any sporting event such as India premier League and the like

(c) Accommodation in hotels including 5 star and above rated hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or loading purposes, where room rent is Rs 8000/- and above per day per room

(d) Gambling

GST

NIL RATE OF GST ON SERVICES

Service by way of giving on hire

(1) to a goods transport agency, a means of transportation of goods.

(2) to a state transport undertaking, a motor vehicle meant to carry more than twelve passengers.

Services by way of transportation by rai or a vessel from one place in India to another of the following goods:

(1) relief materials meant for victims of natural or man- made disasters, calamities, accidents or mishap.

(2) defense or military equipment's.

(3) organic manure.

(4) railway equipment's or materials.

(5) agricultural produce.

(6) milk, salt and good grain including flours, pulses and rice

Services provided by a goods transport agency, by way of transport in a goods carriage of

(1) agricultural produce.

(2) goods, where consideration charged for the transportation of goods on a consignment transported in a single carriage does not exceed one thousand live hundred rupees.

(3) goods, where consideration charged for transportation of all such goods for a single consignee does not exceed rupees seven hundred and fifty.

(4) milk, salt and food grain including flour, pulses and rice.

(5)  organic manure, newspaper or magazines registered with the Registrar of Newspapers.

(6) relief materials meant for victims of natural or man- made disasters, calamities, accidents or mishap; or

(7) defense or military equipment's

Services by the Employees' State Insurance corporation to persons governed under the Employee's State Insurance Act, 1948 (34 of 1948)

Services by way of

(1) extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount (other than interest involved in credit card services).

(2) inter se sale or purchase of foreign currency amongst banks or authorized dealers of foreign exchange or amongst banks and such dealers

(3) Service by way of access to a road or a bridge on payment of toll charges 

(4) Services by way of loading, unloading, packing, storage or warehousing of rice,

(5) Transmission or distribution of electricity by an electricity transmission or distribution utility.

(6) Services by the Reserve Bank of India 

Services provided by the Insurance Regulatory and the Development Authority of India to insurers under the Insurance Regulatory and the Development authority of India Act, 1999 (41 of 1999)

Services provided by the Employees provident fund organization to the persons government under the Employees provident funds and the Miscellaneous Provisions Act 1952 (19 of 1952) 

Services of life insurance business provided by way of annuity under the National pension system regulated by the Pension Fund Regulatory and Develpment Authority of India under the pension Fund Regulatory and Development authority Act, 2013 (23 of 2013)

Services of life insurance business provided or agreed to be provided by the Army, Naval and Air Force Group Insurance Funds to members of the Army, Navy and Air force, respectively, under the Group Insurance Schemes of the Central Government

Services of general insurance business provided under following schemes -

(a)  Rastriya Swasthika Bima Yojana.

(b) Jan Arogya Bima Policy, Central sector scheme on Cattle Insurance, Pradhan Mantri Suraksha Bima Yojna, National Agricultural Insurance Scheme (Rastriya Krishi Bima Yojana).

(c) Niramaya Health Insurance Scheme implemented by the Trust constituted under the provisions of the National Trust for the welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (44 of 1999).

(d) Pilot Scheme on seed Crop Insurance, Universal Health Insurance scheme & Coconut palm Insurance Scheme.

(e) Hut Insurance Scheme, Cattle Insurance under Sanjayanthi Gram Saroz gar Yojna (earlier known as Integrated Rural Development Program).

(f) Scheme for Insurance of Tribals, Janata Personal Accident Policy and Gramin Accident Policy, Group personal accident Policy for Self- Employed Women.

(g) Agricultural Plumpest and Failed well Insurance, Premia collected on export credit insurance.

(h) Weather Based crop Insurance Scheme or the Modified National Agricultural Insurance Scheme, approved by the Government of India and implemented by the Ministry of Agriculture.

Services provided by an incubates up to a total turnover of fifty lakh rupees in a financial year subject to the following conditions, namely: -

(a) the total turnover had not exceeded fifty lakh rupees during the preceding financial year and a period of three years has not elapsed from the date of entering into an agreement as an incubate,

Services provided by-(a) an arbitral tribunal to (1) any person other than a business entity; or (2) a business entry with and aggregate turnover up to twenty lakh rupees (ten lakh rupees int the case of special category states) in the preceding financial year.

(b) a partnership firm of advocates or an Individual as an advocate other than a senior advocate, by way of legal services to (1) an advocate or partnership firm of advocates providing legal services. (2) any person other than business entity' or (3) a business entry with an aggregate turnover up to twenty lakh rupees (ten lakh rupees in the case of special category states) in the preceding financial year.

(c) a senior advocate by way of legal services to - (1) any person other than a business entity; or (2) a business entity with an aggregate turnover up to twenty lakh rupees (ten lakh rupees in the case of special category states) in the preceding financial year.

Services by a veterinary clinic in relation to health care of animals or birds.

Services provided by the Central Government, state Government, Union territory or local authority by way of - it

(a) registration required under any law for the time being in force.

(b) testing, calibration, safety check or certification relating to protection or safety of workers, consumers or public at large, including fire license, required under any law for the time being in force.

Services by an acquiring bank, to any person in relation to settlement of an amount up to two thousand rupees in single transaction transacted through credit card, debit card, charge card or other payment card service.

Explanation - For the purposes of this entry, "acquiring bank" means any banking company, financial institution including non- banking financial company or any other person, who makes the payment to any person who accepts such card.

Services provided by the Securities and Exchange Board of India set up under the Securities and Exchange Board of India Act, 1992 (15 of 1992) by way of protecting the interests of investors in securities and to promote the development of, and to reflate, the securities market.

Services of life insurance business provided under following schemes

(a) Janashree Bima Yojana

(b) Aam Aadmi Bima Yojana

(C) Life micro-insurance product as approved by the insurance Regulatory and Development Authority, have maximum amount of cover of fifty thousand rupees.

(d) Varshitha Pension Bima Yojana.

(e) Pradhan Mantri Jeevan Jyoti Bima Yojana:

(f) Pradhan Mantri Jan Dhan Yogana

(g) Pradhan Mantri Vaya Vandan Yojana

Services by the following persons in respective capacities -

(a) Business facilitator or a business correspondent to an insurance company in a rural area.

(b) Business facilitator or a business correspondent to a banking company with respect to accounts in its rural area branch:

(c) any person as an intermediary to a business facilitator or a business correspondent with respect to services mentioned in entry (b)

Services by way of collection of contribution under the Atal Pension Yojana

Services received by the Reserve Bank of India, from outside India in relation to management of foreign exchange reserves.

Services by way of collection of contribution under any pension scheme of the state Governments

Services provided to the Central Government, state Government, Union territory under any insurance scheme for which total premium is paid by the Central Government, state Government Union territory.

One-time upfront amount (called as premiun,salami, cost, price, development charges or by any other name) leviable in respect of the service, by way of granting long term (thirty years, or more) lease of industrial plots, provided by the State Government Industrial Development corporations or undertaking to industrial units.

Services of leasing of assets (rolling stock assets including wagons, coaches, locos) by the India Railways Finance corporation to Indian Railways.

Services provided by the Central Government, state Government, Union Territory or local authority by way of allowing a business entity to operate as a telecom service provider or use radio frequency spectrum during the period prior to the 1st of April 2016 on payment of License fee or spectrum user charges, as the case may be.

GST RATE ON SERVICES

 NIL RATE OF GST ON SERVICES

(1) Services by the Central Government, State Government, Union territory or local authority excluding the following services ----------

(a) services by the Department of posts by way of speed post, express parcel post, life insurance, and agency services provided to a person other than the Central Government, State Government, Union territory.

(b) services in relation to an aircraft or a vessel, inside of outside the precincts of a port or an a pirport;

(c) transport of goods or passenger; or

(d) any services, other than services covered under entries (a) to (c) above, provided to business entities.

(2) Services by Central Government, State Government, Union territory, local authority or governmental authority by way of any activity in relation to any function entrusted to a municipality under article 243 W of the Constitution.

(3) Services provided by Central Government, State Government, Union territory or a local authority where the consideration for such services does not exceed five thousand rupees:

(i) services by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services provided to a person other than the Central Government, state Government, Union territory:

(ii) services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport.

(iii) transport of goods or passengers:

Provided further that in case where continuous supply of services, as defined in sub-section (33) of section 2 of the Central Goods and Services Tax Act, 2017 is provided by the Central Government State Government, Union territory or a local authority, the exemption shall apply only where the consideration charged for such service does not exceed five thousand rupees in a financial year.

(4) Transport of passengers, with or without accompanied are following ----

> Tripura or at Bagdogra located in West Bengal, Meghalaya, Mizoram, Nagaland, Sikkim, Manipur, air embarking from or terminating in an airport located in the state of Arunachal Prades & Assam.

> Stage carriage other than air-conditioned stage carriage.

> Non- airconditioned contract carriage other than radio taxi, for transportation of passenger, excluding tourism, conducted tour, charter or hire; or 

(5) Services by way of transportation of goods (by road except these services of 

> a goods Transporation agency, a courier agency. & by inland waterways.

> Services by way of transportation of goods by an aircraft from a place outside India up to the customs station of clearance in India.

(6) Services by a government authority by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution.

(7) Services provided by the Central Government, State Government, Union territory to another Central Government, State Government, Union territory or local authority:

Provided that nothing contained in this entry shall apply to services -

(i) by the Department of Posts by way of speed post, express parcel post, lie insurance, and agency services provided to a person other than the Central Government, state Government, union territory.

(ii) in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport.

(iii) of transport of goods or passengers.

(8) Services provided by way of pure Laboure contracts of construction, erection, commissioning, installation, completion, fitting out repair, maintenance, renovation, or alteration of a civil structure or any other original works pertaining to the beneficiary-led individual house construction or enhancement under the Housing for All (Urban)Mission or Pradhan Mantri Awas Yojana

(9) Services by way of renting of residential dwelling for use as residence.

(10) Services provided to the Central Government, by way of transport of passengers with or without accompanied belongings, by air, embarking from or terminating at a regional connectivity scheme airport, against consideration in the form of viability gap funding:

Provided that nothing contained in this entry shall apply on or after the expiry of a period of one year from the date of commencement of operations of the regional connectivity scheme airport as notified by the Ministry of Civil Aviation.

(11) Pure services (excluding works contract service or other composite supplies involving supply of any goods) provided to the Central Government, State Government or Union territory or local authority or a government authority by any activity in relation to any function entrusted to a Municipality under article 243 W of the Constitution.

(12) Services by an entity registered under section 12AA of the Income - Tax Act, 1961 (43 of 1961) by way of charitable activities. & Services by way of transfer of a going concern, as a whole or an independent part thereof.

(13) Services received from a provider of service located in a non- taxable territory by ------

(i) a person located in anon-taxable territory:

(ii) an entity registered under section 12AA of the Income - tax Act, 1961 (43 of 1961) for the purposes of providing charitable activities; or 

(iii) the Central Government, State Government, Union territory, a local authority, a governmental authority or an individual in relation to any purpose other than commerce, industry or any oterh business or profession;

Provided that the exemption shall  non apply to-------

> services by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India received by persons specified in the entry.

(14) Service of transpiration of passengers, with or without accompanied belongings by

(a) public transport, other than predominantly for tourism purpose, in a vessel between places located in India' and metered cabs or auto rickshaw (including e-rickshaws).

(b) railways in a class other than - first class; or an air-conditioned coach.

(15)  Services by way of pure Laboure contracts of construction, erection, commissioning, or installation f original works pertaining to a single residential unit otherwise than as a part of a residential complex

(16) Services by a person by way of - 

(a) renting of precincts of a religious place meant for general public, owned or managed by an entity registered as a charitable or religious trust under section 12AA of the Income - tax Act, 1961 (here in after referred to as the Income tax Act) or a trust or an institution registered under sub clause (v) of clause (23C) of section 10 of the Income - tax Act or a body or an authority covered under clause (23BBA) of section 10 of the said Income- tax Act:-

Provided that nothing contained in entry (b) of this exemption shall apply to, -

(a) renting of rooms where charges are one thousand rupees or more per day.

(b) renting of premises, community halls, Kalyan mandapam or open pare, and the like where charges are ten thousand rupees or more per day.

(c) renting of shops or other spaces for business or commerce where charges are ten thousand rupees or ore per month.

(16) Services by a hotel, inn, guest house, club or campsite, by whatever name called, for residential or lodging purposes, have declared tariff of a unit of accommodation below one thousand rupees per day or equivalent.

(17) Services provided by the Central Government, State Government, Union territory or local authority to a business entity with an aggregate turnover of up to twenty lakh rupees (ten lakh rupees in case of a special category state) in the preceding financial year

Explanation. - For the purposes of this entry, it is hereby clarified that the provision of this entry shall not be applicable to -------

(a) Services-    > by the Department of posts by way of speed post, express parcel post, life insurance, and agency services provided toa person other than the Central Government, State Government, Union territory.

(b) in relation to an aircraft or a vessel, inside or outside the precincts of a port or an pirport;

(c) of transport of goods or passengers; and services by way of renting of immovable property.

Product wise GST Rates

 GST @ 28% OF FOOD PRODUCTS UNDER GST

(1) Sugar, lactose and glucose syrups

(2) Churan for pan

(3) Aerated waters containing added sugar or other sweeting matter

(4) Coca chocolates

(5) Waffles and wafers coated with or containing chocolate

(6) Chewing gum/bubble gum and white chocolate

(7) Malt extract (other than for infant use and mixes and doughs of bakers

(8) Custard powder

(9) Extract, essences and concentrates of coffee

(10) Coca butter, fat and oil

(11) Mustard flour and sauces thereof

(12)  Coca powder

(13) Food flavoring material

(14) Molasses

GST @ 18% OF FOOD PRODUCTS

UNDER GST

GST Input Tax Credit Rules

1. Documents and accountable of inputs and input services

(1) The input tax credit shall be availed by a registered person, including the Input Services Distributor, on the basis of any of the following documents, namely:

(b) an invoice issued by the supplier of goods or services or both in accordance with the provisions of section 31.

(b) a debit note issued by a supplier in accordance with the provisions of section 34.

(c) a bill of entry.

(d) an invoice issued in accordance with the provisions of clause (f) of sub-section (3) of section 31.

(e) a document issued by an Input Services Distributor in accordance with the provisions of sub-rule (1) of rule invoice. 5

(f) a document issued by an Input Service Distributor, as prescribed in clause (g) of sub-rule (1) of rule (4)

(2)  No input tax credit shall be availed by a registered person unless all the applicable particulars as prescribed in Chapter ----- (Invoice Rules) are contained in the said document, and the relevant information, as contained in the said document, is furnished in FORM GST -2 by such person. 

(3) No input tax credit shall be availed by a registered person in respect of any tax that has been paid in pursuance of any order where any demand has been raised on account of any fraud, willful misstatement of suppression of facts. 

(2a) Reversal of input tax credit in case of non-payment of consideration

(a) A registered person, who has availed of input tax credit on any inward supply of goods or services or both, but fail to pay to the supplier thereof the value of such supply along with the tax payable thereon within the time limit specified in the second provision to sub-section (2) of section 16, shall furnish the details of such supply and the amount of input tax credit availed of in FORM GST-2 for the month immediately following the period of one hundred and eighty days from the date of issue of invoice

(2b) The amount of impute tax credit referred to in sub-rule (I) shall be added to the output tax liability of the registered person for the month in which the details are furnished.

(2c) The registered person shall be liable to pay interest at the rate notified under sub-section (1) of section 50 for the period starting from the date of availing credit on such supplies till the date when the amount a added to liability, as mentioned in sub- rule (2), is paid.

(2d) Manner of claiming of credit in special circumstances

(a) Input tax credit claimed in accordance with the provisions of sub-section (1) of section 18 on the inputs lying in stock or inputs contained in semi-finished or finished goods lying in stock, or the credit claimed on capital goods in accordance with the provisions of clauses (c) and (d) of the said sub-section, shall be subject to the following conditions - 

(a1) The input tax credit on capital goods, in terms of clauses (c) and (d) of sub-section (1) of section 18, shall be claimed after reducing the tax paid on such capital goods by five percentage points per quarter of a year or part thereof from the date of invoice or such other documents on which the capital goods were received by the taxable person.

(a2) The registered person shall within thirty days from the date of his becoming eligible to avail of input tax credit under sub-section (1) of section 18 shall make a declaration, electronically, on the common portal in FORM GST ITC ---- to the effect that he is eligible to avail of input tax credit as aforesaid.

(a3) The declaration in FORM GST ITC ---- under clause (b) shall clearly specify the details relating to the inputs lying in stock or inputs contained in semi-finished or finished goods lying in stock, or as the case may be, capital goods-

(I) On the day immediately preceding the date from which he becomes liable to pay tax under the provisions of this Act, in the case of a claim under clause (a) of sub-section (1) of Section 18,

(II) On the day immediately preceding the date of grant of registration, in the case of a claim under clause (b) of sub-section (I) of Section 18,

(III) On the day immediately preceding the date from which he becomes liable to pay tax under section 10, in the case of a claim under clause (c) of sub-section 1 of Section 18,

 (IV) On the day immediately preceding the date from which supplies made by the registered person becomes taxable, in the case of a claim under clause (d) of sub-section (1) of Section 18

(a4) The details furnished in the declaration under clause (c) shall be duly certified by a practicing-chartered account or cost accountant if the aggregate value of claim on account of central tax, State tax and integrated tax exceeds two lakh rupees.

(a5) The input tax credit claimed in accordance with clauses (c) and (d) of sub-section (1) of section 18 shall be verified with the corresponding details furnished by the corresponding supplier in FORM GSTR -1 or as the case may be, in FORM GSTR-4 on the Common portal

Claim of credit by a banking company or a financial institution

(1) A banking company or a financial institution, including a non- banking financial company engaged in supply of services by way of accepting deposits or extending loan or advances that chooses not to comply with the provisions of sub-section (2) of section 17, in accordance with the option permitted under sub-section (4) of section 17, shall follow the procedure specified below-

(a) the said company or institution shall not avail the credit of tax paid on inputs and input services that are used for non-business purposes and the credit attributable to supplies specified in sub- section (5) of section 17, in FORM GSTR - 2.

(b) fifty percent of the remaining input tax shall be the input tax credit admissible to the company or the institution and shall be furnished in FORM GSTR -2;

(c) the amount referred to in clause (b) shall be credited to the electronic credit ledger of the said person.

Procedure for distribution of input tax credit by Input Service Distributor

(1) An Input Service Distributor shall distributors input tax credit in the manner and subject to the conditions specified below-

(a) the input tax credit available for distribution in a month shall be distributed in the same month and the details thereof shall be furnished in FORM GSTR -6 in accordance with the provisions of Chapter ------ (Return Rules).

(b) the Input Services Distributor shall, in accordance with the provisions of clause (d), separately distribute the amount in- eligible as input tax credit under the provisions of sub-section (5) of section 17 and the amount eligible as input tax credit,

(c)  the input tax credit on account of central tax, State tax, Union territory tax and integrated tax shall be distributed separately in accordance with the provisions of clause (d);

(d) the input tax credit that is required to be distributed in accordance with the provisions of clause (d) and (e) of sub-section (2) of section 20 shall be distributed on pro-rata basis to one of the recipients 'R1', whether registered or not, from amongst the total of all the recipients to whom input tax credit is attributable, including the recipient (s) who are engaged in making exempt, supply, or are otherwise not registered for any reason, shall be the amount, "C1" to be calculated by applying the following formula:-

                                                           C1= (t1\T) * C

where

"C" is the amount of credit to be distributed

"t1" is the turnover of person R1 during the relevant period, and

"T" is the aggregate of the turnover of all recipients during the relevant period.

(e) the input tax credit on account of integrated tax shall be distributed as input tax credit of integrated tax to every recipient.

(f) the input tax credit on account of central tax and State tax shall,

----- in respect of a recipient located in the same State in which the Input Service Distributor is located, be distributed as input tax credit of central tax and State tax respectively.

------- in respect of a recipient located in a State other than that of the Input Service Distributor, be distributed as integrated tax and the amount to be so distributed shall be equal to the aggregate of the amount of input tax credit of Central tax and state tax that qualifies for distribution to such recipient in accordance with clause (d). 

----- The input Service Distributor shall issue an ISD invoice as prescribed in sub-rule (1) of rule invoice - 5 clearly indicating in such invoice that it is issued only for distribution of input tax credit.

------- Any additional amount of input tax credit on account of issuance of a debit note to an Input Service Distributor by the supplier shall be distributed in the manner and subject to the conditions specified in the clauses (a) to (f) and the amount attributed to any recipient shall be calculated in the manner provided  in clause (d) above and such credit shall  be distributed in the month in which the debit note has been included in the return in  FORM GSTR -6

Manner of determination of input tax credit in respect of capital goods 

(1) Subject to the provision of sub-section (3) of section 16, the input tax credit in respect of capital goods, which attract the provisions of sub-section (1) and (2) of section 17, being partly used for the purposes of business and partly for other purposes, or partly used for effecting taxable supplies including zero rated supplies and partly for effecting exempt supplies, shall be attributed to the purposes of business or for effecting taxable supplies in the following manner, namely.-

(a) the amount of input tax in respect of capital goods used or intended to be used exclusively for non-business purposes or used or intended to be used exclusively for effecting exempt supplies shall be indicated in FORM GSTR -2 and shall not be credited to his electronic credit ledger.

(b) the amount of input tax in respect of capital goods used or intended to be used exclusively for effecting taxable supplies including zero-rated supplies shall be indicated in FORM GSTR -2 and shall be credited to the electronic credit ledger,

(c) the amount of input tax in respect of capital goods not covered under clauses (a) and (b), denoted as 'A' shall be credited to the electronic credit ledger and the useful life of such goods shall be taken as five years.

Provided that where any capital goods earlier covered under Claus (a) is subsequently covered under this clause, the value of 'A' shall be arrived at by reducing the input tax at the rate of five percentage points for every quarter or part thereof and the amount 'A' shall be credited to the electronic credit ledger.

(d) the aggregate of the amounts of 'A' credited to the electronic credit ledger under clause (c), to be denoted as 'Tc' shall be the common credit in respect of capital goods for a tax period:

Provided that where any capital goods earlier covered under clause (b) is subsequently covered under this clause, the value of 'A' arrived at by reducing the input tax at the rate of five percentage points for every quarter or part Theroff shall be added to the aggregate value 'Tc',

(e) the amount of input tax credit, at the beginning of a tax period, on all common capital goods whose residual life remains during the tax period, be denoted as 'Tm', and calculated as: - 

                                                        Tm=Tc/60

(f) the amount of input tax credit, at the beginning of a tax period, on all common capital goods whose residual life remains during the tax period, be denoted as 'T', and shall be the aggregate of 'Tm' for all such capital goods.

(g) the amount of common credit attributable towards exempted supplies, be denoted as 'Tc', and calculated as:

                                                    Tc=(E/F) x Tr

where,

'E' is the aggregate value of exempt supplies, that is, all supplies other than taxable and zero-rated supplies, during the tax period, and

'F' is the total turnover of the registered person during the tax period:

Provided that where the registered arson does not have any turnover during the said tax period or the aforesaid information is not available, the value of 'E/F' calculated by taking values of 'E' and 'F' of the last tax period for which details of such turnover are available, previous to the month during which the said value of 'E/F' is to be calculated:

Explanation: For the purposes of this clause, the aggregate value of exempt supplies and total turnover shall exclude the amount of any duty or tax levied under entry 84 of List of the seventh Schedule to the Constitution and entry 51 and 54 of List II of the said Schedule.

The amount Te along with applicable interest shall, during every tax period of the residual life of the concerned capital goods, be added to the output tax liability of the person making such claim of credit.

(2)  The amount Te shall be computed separately for cental tax, state tax, Union territory tax and integrated tax.

Manner of reversal of credit under special circumstances

(1) The amount of input tax credit, relating to inputs ling in stock, inputs contained in semi-finished and finished goods lying in stock, and capital goods 9ing in stock, for the purposes of sub- section (4) of section 18 or sub-section (5) of 29, shall be determined in the following manner namely, -

(a) For inputs lying in stock, and inputs contained in semi-finished and finished goods lying in stock, the input tax credit shall be calculated proportionately on the basis of corresponding invoices on which credit had been availed by the registered taxable person on such input.

(b) For capital goods lying in stock the input tax credit involved in the remaining residual life in mints shall be computed on pro-rata basis, taking the residual life as five years.

Illustration

Capital goods have been in use for 4-year, 6 month and 15 days. The residual remaining life in months = 5 months ignoring a part of the month Input tax credit taken on such capital goods=C. Input tax credit attributable to remaining residual life = c multiplied by 5/60

The amount, as prescribe in sub- rule (I) shall be determined separately for input tax credit of IGST and CGST.

Where the tax invoices related to the inputs lying in stock are not available, the registered person shall estimate the amount under sub- rule(I) based on the prevailing market price of goods on the effective date of occurrence of any of the events specified in sub section (4) of section 18 or as the case may be, sub-section (5) of section 29

The amount determined under sub-rule (I) shall form part of the output tax liability of the registered person and the details of the amount shall be furnished in FORM GST ITC -where such amount relates to any event specified in sub-section (4) of section 18 and in FORM GSTR -10, where such amount relates to cancellation of registration.

10: Conditions and restriction in respect of inputs and capital goods sent to the job worker

(a) The inputs or capital goods shall be sent to the job worker under the cover of a challan issued by the principal, including where the inputs or capital goods are sent directly to job worker.

(b) The challan issued by the principal to the job worker shall contain the details specified in rule----- Invoice. 8 Rules:

(c) The details of challans in respect of goods dispatched to a job worker or received from a job worker during a tax period shall be included in FORM GSTR -1 furnished for that period.

GST on Property

 GST on Real Estate 

When it comes to meeting tax obligations, homebuyers along with property taxes, also have to pay the applicable GST on their property purchase. Over the last few years, several changes have been made to the GST regime directed towards the real estate sector.

Potential investors and homebuyers must scrutinize the implications of GST on real estate to make an informed decision when it comes to investing in this sector.

What is GST on Property in India

GST on property in India refers to the Goods and Services Tax (GST) applied to real estate transactions. Which was introduced by the Indian government in 2017 to harmonies global Taxation frameworks. Before GST on flat purchase, multiple taxes like value-added tax (VAT) services Tax. and central excise were levied on property purchase, making the process complex and less transparent.

Impact of GST on Rent: GST on House Rent and Commercial Property Rent

Are you wondering if you must charge and collect Goods and Services Tax (GST) on the rent received by you? the treatment of GST differs between residential and commercial renting. On the other hand, if you run a business, then rent payment is one of those prominent expenses and you may want to know your eligibility for claiming Input Tax Credit (ITC) on GST paid on the rental expense. Let's understand all these in detail.

GST Taxation on Real Estate:

Particulars

 Ready to Move Properties 

 Under construction properties (house bought under credit linked subsidy scheme)

Under construction properties (excluding the other)

Resale properties

Land purchase and sale

Works contract

Composite Supply of works

Composit supply of works to Govt Authority

Composit supply of use for the general public

Composit supply of works contract for affordable housing

Tax on Rental Inco me in the pre-GST era

During the per-GST era, the landlord had to obtain a service tax registration if their

total taxable services (including the rental income from all properties) exceed Rs 10 lakh per year. As long as the rental income (from all the properties that have been rented out) does not exceed Rs. 10 lakh per year, the landlord would not be attracted to service tax

Under the previous tax regime, commercial properties alone, that were let out would attract service tax. This applies even if a residential property is used for commercial purposes. Service tax was levied at 15% of the rent, for commercial properties. Moreover, the rental income from residential properties did not attract service tax.

GST on New Flats

The GST on new flats is set at 5% directly influencing the ultimate purchase cost. Developers are eligible to receive the input tax credit (ITC) advantage for the supplies and Labour used in constructing the apartment. However, developers don't need to pass this ITC benefit on to the byer. Therefore, the final cost of a new apartment may vary depending on whether or not the developer chooses to transfer the ITC benefit to the buyer. This can affect the overall expense and should be considered when budgeting for a new flat.

GST Calculation on Real Estate

By factoring in the cost of property and the applicable GST rate and other charges, one can easily estimate the GST on property. To break it down, GST liability is computed by adding the State GST and Central GST.

For instance,

Total GST = SGCT + CGST

Notably, this GST regime extends an abatement of 33% of the contract amount as land value.

Example of GST Calculation

This simple example emphasizes how GST is computed on under-construction property.

Suppose an under-construction property is worth Rs. 1000 and is sold to a buyer. The GST on the property in question is computed after factoring in the standard abatement on under-construction property.

So, after deducing the 33% Rs. will be considered as the land value. Subsequently. GST on the property will be computed on the remaining Rs. 770 by implementing the applicable.

Does renting out a property attract GST

According to the GST Act, renting out an immovable property would be treated as a supply of services. GST, however, will be applicable only to certain types of rent such as:

(a) Ehen a property is given out on lease, rent, easement, or licensed to occupy

(b) When any property is leased out (or let out including a commercial industrial, or residential property for business (either or wholly) this type of renting is considered a supply of services and would thus attract tax. When you rent out a residential property for residential purposes, it is exempt from GST. Any other type of lease of renting out of the immovable property for doing business would attract GST at 18%, as it would be treated as a supply of service.

GST Exemptions on Real Estate

Under schedule III of GST Act, 2017, ready-to-move-in properties do not come under the category of goods or services. It is more like an activity of purchase or sale of a property. This is why GST is not applied to ready-to-move Propeties with a legitimate Completion Certificate.

Similarly, individuals will not be required to pay GST on resale properties and purchase and sale of land.

Other than the said exemption, real estate developers are entire to claim the Input Tax Credit on construction material under the GST system. Notably, to claim such benefits, developers need to meet a few specific conditions. for example, to proceed with the claim developers need to 

(a) submit invoices/receipts of construction material

(b) The developer must receive goods and services

(c) Claims on personal use of goods and services will not be entertained

(d) All pending dues must be cleared

(e) GST must be filed accurately

Who is required to register when the property is rented out to business?

A taxpayer earning more than the exempted threshold will have to register under GST and pay taxes So, if you have given your property to a business, then it is taxable. If you are earning income from business including rent and any other exempted income of more than Rs. 20 lakh per annum. You will have to register yourself under GST.

The threshold limit for applicability of GST for those providing only services is Rs. 20 lakhs, more than the Service Tax limit of Rs. 10 lakhs. this makes many landlords - who were covered under the Services Tax regime be at ease now up to another Ts. 10 lakhs earned.

(Please note that the threshold limit of Rs. 20 lakh excludes special category states, where the limit remains at Rs. 10 lakhs.)

Let us look at an example - Mohan resides in Delhi and has a property in Bangalore that is rented out to Goel Furniture Co. for use as a show room for the Bangalore Property. he is getting a rental income of Rs 50000 monthly or Rs. 6,00,000 per annum alone. under GST, the place of supply shall be the location of the immovable property.

Therefore, even though the person resides in Delhi, the place of supply will always be where the property is situated, which is Bangalore in this example. Here, the total income is below Rs. 20 lakh a year, thus Mohan is excluded from GST applicability

It needs to be noted that, though this property is used for residential purposes, it cannot be said that the rent that is received is that from the residential property as this property is given to a company for their use. How they use the said property is not the deciding factor.

No GST on residential property rented in personal capacity for use as a residence

In the 48th GST Council meeting, the Council clarified that no. GST is payable where a residential dwelling is rented to a registered person if the same is rented it in their personal capacity and for use as their own residence

This means that where a registered person is proprietor of a proprietorship firm, and they have rented out a residential property in their personal/own capacity (and not that of the proprietorship) and the property is for use as their own residence then no GST will be applicable