NEW DELHI: The Centre on Friday issued a clarification regarding GST on house rent, noting renting a residential unit is taxable only when it is given to a business entity.
Responding to news reports, claiming that tenants would now have to pay 18 per cent Goods and Services Tax (GST) on house rent, the Government's official fact-checker said such claims were misleading.
PIB Fact Check clarified on Twitter that there would be no GST when a house is rented to a private person for personal use, and not even when the proprietor or partner of a firm wants to rent a residence for personal use.
"Renting of residential units taxable only when it is rented to a business entity. No GST when it is rented to a private person for personal use. No GST even if the proprietor or partner of a firm rents residence for personal use," PIB Fact Check tweeted from its official handle.
GST registration is needed when any person carries on business or profession and makes an annual turnover more than the threshold limit defined under the GST law.