GST on Notional Income

[Ethirajan Parthasarathy]

A GST registered person gives away commercial space to a trader by taking quite a large amount as refundable deposit. The understanding is the trader will use the space for business purpose for a period of 7 years without payment of any rent, after expiry of 7 years he has to surrender the place back to the Landlord who will return the large deposit received.

As per Income Tax Law the landlord has to pay Income tax on the notional rental income in respect of above arrangement.

I would like to know GST implication on the Land lord in the above circumstance.

AI Summary

Notional rent GST liability: GST payable on open market value for supply of premises where consideration is partly non monetary.
The landlord's transfer of premises for a refundable deposit and no rent is consideration not wholly in money; GST value is the open market value (notional rent) of the supply, and that notional income constitutes taxable consideration for the supply of premises, giving rise to GST liability.