A house property (say a building, office, or commercial space) is jointly owned by two or more persons.

 

🧾 Scenario:

A house property (say a building, office, or commercial space) is jointly owned by two or more persons.
One of the co-owners is registered under GST, and the property is rented out to a client.

1️⃣ Determine the nature of supply

Renting of commercial property is a supply of service under GST.
(If residential property is rented for residence, it is exempt.)

2️⃣ GST registration and responsibility

CaseWho should charge GSTRemarks
All co-owners are jointly rentingEach co-owner is treated as a separate supplier for their share.Each co-owner must register separately if their individual rental income exceeds ₹20 lakh (₹10 lakh in special category states).
One co-owner is GST registered and others are notThe registered co-owner will issue a GST invoice for their share of rent only.The unregistered co-owner cannot charge GST on their portion. They can issue a normal (non-GST) receipt.

3️⃣ How to invoice the client (tenant)

Let’s assume:

  • Total rent = ₹1,00,000 per month

  • Co-owner A (GST registered) share = 50%

  • Co-owner B (not registered) share = 50%

Then:

Co-ownerInvoice amountInvoice type
A (registered)₹50,000 + 18% GST = ₹59,000GST invoice with GSTIN, HSN 9972 (rental service)
B (unregistered)₹50,000 (no GST)Simple rent receipt or agreement reference

Tenant will pay ₹59,000 to A and ₹50,000 to B separately (or as per agreed payment mechanism).

4️⃣ Important GST Notes

  • The aggregate turnover for registration threshold (₹20 lakh) is calculated per co-owner individually, not jointly.

  • If the property is leased through a partnership firm or AOP, then the firm is the supplier — GST applies on total rent in that case.

  • Always mention PAN-based share of income consistently in income tax filings.

Comments

Post a Comment

Popular posts from this blog

Capital Gains Tax on Sale

  1. Capital Gains Tax on Sale of House Property vs. Land Criteria House Property (Building & Land) Vacant Land (Plot of Land) Holding Period for LTCG More than 24 months (Long-Term) More than 24 months (Long-Term) Holding Period for STCG ≤ 24 months (Short-Term) ≤ 24 months (Short-Term) STCG Tax Rate As per Slab Rate As per Slab Rate LTCG Tax Rate 20% with Indexation 20% with Indexation Indexation Benefit ✅ Available ✅ Available Exemptions Available Section 54 (Reinvestment in house) & Section 54EC (Bonds) Only Section 54F (Reinvestment in house) & Section 54EC (Bonds)   🔹 Key Difference in Exemptions House Property: Eligible for Section 54 , allowing reinvestment in another re...
Read more

Purpose Codes for Export Transactions

Purpose Codes in detail — especially P0104 (Export of goods) — which are required for foreign remittances under FEMA/RBI regulations. 🏦 1. What is a Purpose Code? A Purpose Code is a standardized code prescribed by the Reserve Bank of India (RBI) to identify the nature of a cross-border transaction — whether it’s for exports, imports, services, loans, investments , etc. These codes are used by Authorized Dealer (AD) Banks to report every foreign exchange transaction to the RBI through: EDPMS (Export Data Processing and Monitoring System) for exports, and IDPMS (Import Data Processing and Monitoring System) for imports. 🌍 2. Purpose Codes for Export Transactions When you receive a foreign inward remittance against an export, your AD Bank must enter the correct Purpose Code while reporting the transaction. Here are the most common export-related purpose codes 👇 Purpose Code Description (as per RBI) Used For P0104 Export of goods For physical ex...
Read more

What Is Incriminating Material in Income Tax Law?

  What Is Incriminating Material in Income Tax Law? Incriminating material refers to any document, record, statement, digital evidence, or seized item during a search or survey that directly indicates undisclosed income, transactions, or assets of the taxpayer, and can justify an addition in assessment or reassessment. 📚 Judicially Recognized Definition “Incriminating material” is any evidence unearthed during a search which: Relates to a specific assessment year , and Reveals income not disclosed in the original return or books of account 📂 Examples of Incriminating Material Type Examples 💵 Cash / Jewellery Unexplained cash or jewellery without proper source 📝 Documents Unaccounted invoices, promissory notes, loan ledgers 🖥️ Digital evidence Files/emails showing black money, hawala, or bogus transactions 📒 Books of account Parallel books of accounts 📄 Agreements Benami transactions, property undervaluation 💼 Diaries / slips Unrecorded business transac...
Read more