Computation of GST ,on amount exceeding Thrashed

[dhirajlal patel]

Dear sir

In case of a member of co op hsg society ,n the maintainable charges up to RS 7500/ charged by a society no GST is to be charged ,Now the question arises is if Maintenance charges exceeds thrashed limit of RS 7500/ then ,whether GST is to be levied on the entire Sum or only on the difference between Entire sum and thrashhold limit of RS 7500/ ,What does the provisions of GST stipulate in these understands

[Ganeshan Kalyani]

In my view, GST is applicable on the amount in excess of threshold limit for the first time. Subsequent year onward GST is applicable on the very first maintenance amount .

[KASTURI SETHI]

Sh.Ganeshan Kalyani Ji is 100% correct. If maintenance charges are ₹ 8000/- on monthly basis per member, GST is to be paid on ₹ 500/- and NOT on ₹ 8000/-. There is not even an iota of doubt. Threshold exemption of ₹ 7500/- is admissible. One should not compare it with Service Tax era.(Notification No.25/12-ST). The anomaly has been rectified in the GST regime.

[Ganeshan Kalyani]

Thanks Sri Kastrui Sir.

[Ganeshan Kalyani]

Apology for spelling mistake. Pls. read as Thanks Sri Kasturi Sir.

[DR.MARIAPPAN GOVINDARAJAN]

GST is applicable exceeding the threshold amount.

[dhirajlal patel]

It is true and undisputed that G S T is applicable once Thrashhold of RS 7500/ exceeds ,but question is whether G S T is leviable on the entire amount or a difference of amount ,is the moot question ,on which there is no clarity and Co op societies are charging GST on the entire Amount

[KASTURI SETHI]

GST is payable on the amount which is in excess of ₹ 7500/-. There is no doubt. If someone is paying GST on whole amount that is incorrect. It does not mean all should follow them.Those persons are paying out of phobia of the department. There are instances where the assessees adopt wrong practice by following others without understanding law.

[KASTURI SETHI]

This is relevant extract of Notification No.12/17-CT(Rate) dated 28.6.17 as amended. Note Rate is NIL and Condition is NIL (Col.no.3 & 4 respectively) up to ₹ 7500/- (increased from 5000/-). No words. ' threshold exemption' have been used in this service. It is NIL rate up to ₹ 7500/-

77	Heading 9995	Service by an unincorporated body 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 -	Nil	Nil
		(a) as a trade union;
		(b) for the provision of carrying out any activity which is exempt from the levy of Goods and Service Tax; or
		*(c) 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 a housing society or a residential complex.

* increased to ₹ 7500/- vide Notification No.2/18-CT(Rate) dated 25.1.18

AI Summary

GST on maintenance charges applies only to amount exceeding exemption threshold, not on the entire sum. Supplies by a nonprofit housing society to its members are subject to a nil rate up to a prescribed monthly threshold; GST becomes chargeable only on the amount exceeding that threshold, and the correct practice is to calculate GST on the surplus above the threshold rather than on the entire maintenance charge.