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The taxation of rental income from immovable property has undergone a marked evolution from the service tax regime to the Goods and Services Tax (“GST”) framework. Under the erstwhile Finance Act, 1994, service tax was levied only on commercial renting, while renting of residential dwellings remained outside the tax net.
The Gujarat AAR, in the matter of Suzuki Motor Gujarat Pvt. Ltd. held that company facilitating accommodation for permanent employees, provided through a third-party and with nominal deductions is a non-taxable “perquisite”. However, GST applies to similar services for student trainees.
Issue of the levy of GST on residential accommodation should be viewed from the perspective of the recipient of service
A charitable trust providing accommodation to pilgrims visiting Ambaji Temple in a building located outside the boundary of the religious…