Good News for Small Flat Owners! No GST on Affordable Units — But 18% Still Applies Above Limit, Finance Minister Reaffirms
Good News for Small Flat Owners! No GST on Affordable Units — But 18% Still Applies Above Limit, Finance Minister Reaffirms
Residents get clarity as government states GST compliance lies with housing societies, not individuals
Residents living in modest apartment units across India can breathe easy. Finance Minister Nirmala Sitharaman has officially reaffirmed that monthly maintenance charges below ₹7,500 per flat are exempt from Goods and Services Tax (GST). The assurance came in a written response to a Starred Question in the Lok Sabha, aiming to end long-standing confusion surrounding GST obligations for housing societies and middle-income residents.
The clarification emphasized that individual flat owners are not responsible for any GST compliance under the current rules. Instead, the onus lies solely on apartment associations, which are considered service providers under GST law.
The ₹7,500 exemption threshold was set during the 25th GST Council meeting in January 2018, an increase from the earlier limit of ₹5,000. Regardless of a society’s total income, if a resident pays less than ₹7,500 per month, no GST is applicable on the maintenance amount. This includes common expenses like security, cleanliness, and lift charges.
However, if the annual turnover of a housing society exceeds ₹20 lakh (or ₹10 lakh in some states like Uttar Pradesh and Himachal Pradesh), and monthly charges cross ₹7,500, then 18% GST is applicable. In such cases, the housing society not the residents is responsible for collecting and remitting the tax.
Critics have pointed out that the Centre, which imposes GST on essential goods and services, hasn’t spared even apartment maintenance. Still, the recent parliamentary clarification offers much-needed relief and certainty for lakhs of urban families managing tight household budgets.
