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Question ID : 44601


A registered person, An architect firm is paying rent to unregistered person for a property being used for his office . Whether he will be covered under reverse charge

Posted by Mahesh Kumar on Jan 26, 2024

Filed Under GST

Answer ID : 85281

No, It is not covered under RCM.

Posted by CA. chunauti dholakia on Jan 27, 2024
Answer ID : 85321

There could be two possibilities; Commercial property taken on rent: In such a case, the service provider (i.e., Building owner) shall take the GST registration if his aggregate turnover exceed the specified threshold limit and discharge GST under FCM. If such a service provider (i..,e Building owner) is unregistered, then no GST shall be paid by the tenant (i..e, Registered entity) under RCM, in the absence of a specific entry under Notification 13/2017-CT(R) as amended from time to time, which is read with Section 9(3) of the CGST Act 2017. Residential property taken on rent and used for business: In such a case, in terms of Sl.No 5AA of the Notification 13/2017-CT(R) as amended from time to time 'Service by way of renting of residential dwelling to a registered person', the GST shall be paid by the registered person under RCM on the rent paid. Note: From 01st July 2017 to 12th October 2017: [In accordance with Sec 9(4) of CGST Act] Payment of GST under RCM was exempted where the aggregate value of the goods and services procured by the registered person from the unregistered vendors were not exceeding Rs. 5,000 in a day. Where the value of the procurements from the unregistered vendor exceeded Rs. 5,000 in a day, then the registered recipient was liable to pay GST under RCM on the entire value of the taxable goods and taxable services procured from the unregistered vendors. After 12th October 2017, Section 9(4) was kept in abeyance. Only from 01st April 2019, few reale state procurements from unregistered vendors are made taxable.

Posted by SREENIVASULU THULASIRAM on Feb 11, 2024