GST on Rental Income

[Ethirajan Parthasarathy]

During last one year most of the landlords are facing problem of collection of rent. Tenants ask for adhoc reduction, which is further reduced during lockdown period. Even the reduced rent is paid in instalments or even deferred

In such a situation, what is the safe approach for the landlord to file his monthly GST returns and payment of tax thereon.

AI Summary

GST on rental income applies only to rent actually received; amend leases and use invoices or credit notes.
GST on rental income is chargeable only on actual consideration received; landlords should amend lease agreements to record agreed reductions or deferrals so liability aligns with revised consideration. An invoice creates tax liability and, if no invoice is issued, the date fixed for receipt governs the time of supply. Where agreements cannot be amended, revised invoices and credit notes describing COVID-19 relaxation should be issued and books should reflect amounts actually received to support charging GST only on realized rent.