GST applicability on Rental income to Director of company

[JIGAR SHAH]

One of our clients is a private limited company; it has given rent and interest to its director. Let's say the interest income was ₹ 15 lakhs and Rental Income was ₹ 6 lakhs. Further, he has rental income from outside party of ₹ 2 Lakhs.

What will be the total turnover under GST for the director? Whether interest income will be included to compute total turnover?

Whether GST will be charged on rental income of ₹ 6 lakhs or it will fall under reverse charge mechanism?

If total turnover will be ₹ 23 lakhs (15+6+2) whether GST will be payable on ₹ 2 lakhs and ₹ 6 lakhs GST will be paid by company under reverse charge mechanism?

AI Summary

GST on rental income: distinguishes taxable commercial rent, nil rated interest, and reverse charge responsibility.
Interest income and rent from residential property are nil rated supplies, while rent from commercial property is a taxable supply and counts toward aggregate turnover for registration under section 22; aggregate turnover includes all taxable and exempt supplies excluding inward supplies taxed under reverse charge. The allocation of GST on rent paid by a company to its director depends on whether renting services are treated as supplied in the director's personal capacity (forward charge) or fall under the reverse charge mechanism as contemplated by notification entries referring to a director.