RCM Tax on residential property

[Ethirajan Parthasarathy]

Renting of residential unit to (GST) registered person is liable to GST under RCM.

A proprietor of a business entity is registered under GST. Is he liable to pay GST on house taken by him for is personal residence.

If yes, it may be additional burden for him since he cannot take ITC on such tax paid by him since the rent paid is personal expense. Can experts give their view on this.

AI Summary

Reverse charge on residential rent clarified: exemption applies when a proprietor rents personally and not on the firm's account.
Renting of residential dwelling to a registered person can attract RCM; proprietors renting a dwelling for personal use were initially seen as liable under RCM without ITC, but a notification clarifies that the exemption applies where the proprietor rents in his personal capacity for use as residence and the renting is on his own account and not that of the proprietorship concern.