GST on Repairs Recovered

[Ethirajan Parthasarathy]

While the tenant vacates, the Landlord with holds certain sum, towards damages caused by the tenant.

Is Landlord (who is GST registered) liable to pay GST on such sum recovered from the tenant.

[KASTURI SETHI]

If you retain the amount, then the transaction is covered under Schedule-II Serial No.5 (e) of CGST Act.

(e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act; and

[Himansu Sekhar]

Yes, kasturi sir is correct

[Himansu Sekhar]

But subject to the small scale ecemption

[Ganeshan Kalyani]

I too agree with the views of the experts.

[Himansu Sekhar]

Thank you sir

[Hariharan Sundaram]

Respected experts is there any concept of small scale exemption under GST ? The exemption is available only for registration. Once the person is registered he has to pay Gst kindly enlighten me

[Himansu Sekhar]

I assume that the land lord is not registered. The queriest has not mentioned anything about the registration. There is no doubt, once registered, no exemption based on value will be applicable. I

AI Summary

GST Applies to Landlord's Retained Amount for Tenant Damages Under Schedule-II Serial No.5(e) of CGST Act. A landlord, registered under GST, inquires about the tax implications of retaining a sum from a tenant for damages upon vacating. It is clarified that such transactions fall under Schedule-II Serial No.5(e) of the CGST Act, involving obligations to tolerate an act. Experts agree that GST applies to the retained amount, although a small-scale exemption might apply if the landlord is not registered. Once registered, no exemption based on value is applicable. The discussion highlights a misunderstanding about the scope of small-scale exemptions under GST, which apply only to registration, not to tax liability once registered.