Residential Dwelling - RCM

[Ethirajan Parthasarathy]

Recently letting out residential dwelling to registered person is brought to GST under RCM.

In one case, an apartment is let out to business entity registered under GST.

The landlord is already charging GST under “forward charge”

Is it now required that landlord should stop charging GST and tenant should start paying GST under RCM

AI Summary

Reverse Charge Mechanism on residential rent now applies when dwelling is let to a registered person.
Amendment effective 18-07-2022 removes the exemption for renting residential dwellings when the lessee is a registered person, bringing such supplies under the reverse charge mechanism so that the registered recipient bears GST. There is a factual and interpretative dispute: one reading applies RCM uniformly for rentals to registered persons, while an alternative reading maintains forward charge liability where the dwelling was already taxed as commercial/office use before the amendment. The phrase "to a registered person" is understood to mean registration for business purposes.