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Notification No. 09/2024 Update | GST on Property Rentals

by | Nov 15, 2024 | GST, 2024 Notifications, Central Tax (Rate) 2024 Notifications, Notifications | 0 comments

Notification No. 09/2024 - Central Tax (Rate) Finodha.in
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Important Keyword: Notification No. 09/2024 – Central Tax (Rate), GST on renting, Goods and Services Tax property rental 2024, Goods and Services Tax unregistered to registered rent, GST update October 2024,

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[F.No. 190354/149/2024-TO(TRU-II) – Part-I CBEC]
Government of India
Ministry of Finance
(Department of Revenue)

New Delhi, the 8th October, 2024

Notification No. 09/2024 – Central Tax (Rate): Seeks to amend Notification No. 13/2017 – Central Tax (Rate) dated 28.06.2017

GST [TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

GSR      (E).- In exercise of the powers conferred by sub-section (3) of section 9 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following further amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), number 13/2017-Central Tax (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub- section (i), vide number G.S.R. 692(E), dated the 28th June, 2017, namely: –

  1. In the said notification, in the Table, after serial number 5AA and the entries relating thereto, the following serial number and entries relating thereto in columns (2), (3) and (4) shall be inserted, namely: –
(1)(2)(3)(4)
“5ABService by way of renting of any property other than residential dwelling.Any unregistered personAny registered person.”
  • This notification shall come into force with effect from the 10th day of October, 2024.

(Dilmil Singh Soach)
Under Secretary to the Government of India

Note: -The principal notification number 13/2017 -Central Tax (Rate), dated the 28th June, 2017 was published in the Gazette of India, Extraordinary, vide number G.S.R. 692 (E), dated the 28th June, 2017 and was last amended vide notification number 14/2023 -Central Tax (Rate), dated the 19th October, 2023 published in the Gazette of India vide number G.S.R. 765(E), dated the 19th October, 2023.

📚 Frequently Asked Questions (FAQs): Notification No. 09/2024 – Central Tax (Rate)

Q1: What does Notification No. 09/2024-Central Tax (Rate) specify?

Answer:
The notification introduces a new entry (5AB) to the reverse charge mechanism under GST. It states that if an unregistered person rents out property (excluding residential dwelling) to a registered person, the liability to pay GST falls on the registered recipient.

Q2: When does this notification come into force?

Answer:
The provisions of Notification No. 09/2024-Central Tax (Rate) become effective from October 10, 2024.

Q3: Does the new rule apply to residential property rentals?

Answer:
No 🏠. The reverse charge mechanism introduced via entry 5AB is only applicable to renting of property other than residential dwellings.

Q4: Who is liable to pay GST in case of rental by an unregistered person to a registered person?

Answer:
Under the reverse charge mechanism, the registered person receiving the service (tenant) is liable to pay GST, not the unregistered landlord.

Q5: How does this affect GST compliance for registered businesses?

Answer:
Businesses must account for and pay GST on such rental services via reverse charge and report it in their GSTR-3B. They can also claim input tax credit (ITC) where eligible. For seamless compliance, explore: GST Compliance Services – https://finodha.in/gst-compliance/

Q6: Is GST registration required for the unregistered property owner now?

Answer:
No, the liability to pay GST lies with the registered recipient under RCM, so the unregistered landlord does not need to register under GST due to this transaction alone.

Q7: How do I report such transactions in GST returns?

Answer:
These must be reported under reverse charge in GSTR-3B. Use the “Reverse Charge Supplies” section. For help with returns, visit: GST Return Filing – https://finodha.in/gst-return-filing/

Q8: What is the legal backing for this change?

Answer:
This amendment is issued under Section 9(3) of the CGST Act, 2017, allowing the government to notify categories of supply for which the recipient is liable to pay tax under reverse charge.

Q9: How does this change compare with previous provisions?

Answer:
Earlier, renting of property by an unregistered person was not covered under reverse charge. This notification brings such transactions under the GST net if the recipient is registered.

Q10: Where can I get expert help for GST on rental services?

Answer:
Consult GST experts at www.Finodha.in for advisory and compliance support. You can also register your business at https://finodha.in/online-gst-registration/

🧠 Did You Know?

Under reverse charge, recipients cannot avoid compliance even if the supplier is unregistered. This ensures that the GST system remains robust and leak-proof.

🚀 Want to avoid penalty?

Ensure accurate filing of RCM liabilities. Get help from GST Professionals here 👉 https://finodha.in/gst-compliance/

🔚 Conclusion:

Notification No. 09/2024-Central Tax (Rate) significantly expands the reverse charge mechanism, making GST compliance mandatory for registered recipients of non-residential rental services from unregistered persons. Stay ahead by aligning your rental agreements and reporting practices with the new changes.

💼 Explore more from Finodha:

Download PDF: Notification No. 09/2024 – Central Tax (Rate)

CTR-09-2024Download

More Information: https://taxinformation.cbic.gov.in/

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