GST on Maintenance Charges of Apartments and Housing Societies
Maintenance Charges are the contributions that apartment buildings or Resident Welfare Associations (RWAs) receive from the residents in order to fund the maintenance and oversight of shared facilities. These costs often cover cleaning, safety, and maintenance of common areas such as swimming pools, community halls, playgrounds, gyms, lifts, and other essential services that help in the seamless running of the housing society. On July 22, 2019, the government issued Circular No.109/28/2019-GST to address concerns about GST on annual maintenance charges demanded by RWAs to their members. The purpose of this circular was to provide clarity on the GST rules governing flat maintenance fees.
Applicability of GST on Apartment Maintenance Charges
Under the previous service tax framework, housing societies were mandated to register with the service tax laws if the total maintenance charges imposed by the society exceeded Rs. 10 lakhs in a financial year. However, the threshold has been increased to Rs. 20 lakhs under the Goods and Services Tax (GST) system. This means that if the total maintenance charges levied by the housing society exceed Rs. 20 lakhs in a financial year, it is required to register under the GST laws and secure a registration number.
It’s important to note that even exempt items, such as the recovery of property tax and electricity bills from members, should be considered when calculating the threshold of Rs. 20 lakhs. Therefore, a housing society must collect GST from the residents if the overall charges, whether GST is applicable or not, go beyond Rs. 20 lakhs. Although the registration threshold for a housing society is set at Rs. 20 lakhs, it is not obligated to collect GST on apartment maintenance if the charge for each flat or office is at most Rs 7,500 for a month.
Read Also: Apartment Maintenance Charges Rules and Regulations
Applicability Conditions of GST on Society Maintenance Charges
For the imposition of GST on society maintenance charges, the housing society must fulfil two criteria:
- The total of the fees collected by the society should surpass Rs 20 lakhs within a financial year, and
- The monthly maintenance fee for a specific flat or office should exceed Rs 7,500.
Therefore, it’s possible that society might not collect GST on society maintenance for smaller flats or offices, while it could collect it for larger flats or offices if the maintenance fees are based on the size of the flat or office.
If the monthly maintenance cost for a housing society exceeds Rs. 7500 per home, an 18% Goods and Services Tax (GST) is charged on the total sum.
If an individual possesses multiple homes within a single society, a separate limit of Rs. 7500 is recognised for each additional property, each receiving a personal tax-free allowance of Rs. 7500.
GST on Maintenance Charges of Society: Applicability Table
| Turnover of a Housing Society (in 1 FY) | Maintenance Charge (Per Month, Per Member) | GST on Maintenance Charge Applicability |
| More than Rs. 20 Lakh | Up to Rs. 7500 | Not Applicable |
| More than Rs. 20 Lakh | More than Rs. 7500 | Applicable |
| Up to Rs. 20 Lakh | Up to Rs. 7500 | Not Applicable |
| Up to Rs. 20 Lakh | More than Rs. 7500 | Not Applicable |
Note:
Even if the GST on apartment maintenance charges surpasses INR 7,500 per month per member, the RWA is exempt from applying for GST registration or paying GST if its total income does not reach INR 20 lakhs in a single fiscal year.
Also Read: TDS on Maintenance Charges
Expenses That Are Included Under GST on Apartment Maintenance Charges
1. Sinking Fund
As this service is provided to members, it’s taxable and should be factored into the limit of Rs. 7.5k.
2. Property Tax on Common Areas
This must be included in the society maintenance GST when determining the limit (Rs. 7.5 Thousand).
3. Shared Water Cost
If these fees are for regular water usage, they are taxable and included in the limit.
4. Maintenance Fees
These cover administrative expenses, security, and account audits, making them taxable under GST on apartment maintenance charges and subject to deduction from the limit.
5. Use of Shared Areas by Members or Visitors
GST on society maintenance charges has to be collected as these are taxable charges, and they are considered in the Rs. 7500 limit.
6. Standard Services
Facilities like the clubhouse and swimming pool are taxed and have a maximum limit of INR 7,500.
Also Check: 18% GST on Apartment Maintenance Above ₹7,500
Expenses That Are Excluded Under GST on Apartment Maintenance Charges
1. Parking Fees
Paid by members for parking spaces, these are taxed and are not included in the 7,500 limit. They are charged one-on-one and are not meant for collective use.
2. Property Tax on Private Areas, Parking, and More
Since the society acts as an intermediary, it’s exempt from property tax and not bound by the Rs. 7.5 Thousand limit.
3. Fees for Share Transfers
These are for transfer of shares, particularly in real estate sales, and are taxed; but, because no outside entity is involved, they do not count towards the total limit of Rs. 7.5k.
4. Rental Income
These services, which are specialised and mainly for businesses, are taxable. If the society does not qualify for coverage under GST, it will be liable to rent control measures (RCM) beginning 1st April 2018.
5. Water Costs Collected by the Society for a Single Member
Water costs collected by the society for a single member are exempt from GST on maintenance charges of society, as they are charged to an individual member and do not exceed the ₹7,500 limit.
6. Interest on Default
Since interest on default is a fee for each instance, it’s taxable and not subject to the Rs. 7,500 Limit.
Also Read: GST on Apartments
Is GST Applicable on Maintenance Charges Collected by Builders?
Builders often collect maintenance charges on behalf of residents or housing societies. Understanding which charges attract GST helps avoid confusion and ensures compliance. The table below summarises the applicability of GST on maintenance charges collected by builders.
| Type of Maintenance Charge | GST Applicable? | Key Notes |
| Residential maintenance ≤ ₹7,500 per flat | No | GST is not applicable if the society’s turnover is below the threshold |
| Residential maintenance > ₹7,500 per flat | Yes | 18% GST applies if society is GST-registered |
| Pure reimbursement (electricity, water, property tax) | No | Considered as reimbursement, not a service |
| Facility management/service charges are collected separately | Yes | 18% GST generally applies |
| Maintenance charges for commercial buildings | Yes | 18% GST applicable, no ₹7,500 exemption |
GST on Maintenance Charges of Commercial Building
GST on maintenance charges of commercial buildings is generally applicable at 18%, regardless of the amount collected. Commercial properties do not enjoy the ₹7,500 exemption available to residential societies.
Key points to remember:
- GST applies if the maintenance service is taxable and the provider is registered.
- Commercial units almost always attract GST on maintenance.
- Proper invoicing and GST compliance are essential for builders and facility managers.
Calculation of GST on Apartment Maintenance Charges
Resident Welfare Associations (RWAs) must follow specified procedures for calculating and submitting GST on apartment maintenance charges.
The GST on maintenance charges is calculated by applying the GST rate applicable to the amount that is subject to tax. The amount subject to tax is determined using the list of charges specified in this blog, and the typical rate of GST on maintenance for such services is 18%.
Here a detailed instructions on how to calculate and submit GST on flat maintenance fees:
Step 1: Identifying Which Charges are Taxable
RWAs should first determine which components of maintenance charges associated with a flat are excluded from GST and which are not.
For instance, it is not necessary to divide expenses according to their taxability if a member’s contributions every month are under INR 7,500. Conversely, the components have to be separated in order to guarantee a precise GST computation.
Step 2: Filing and Submission of GST Returns
After the GST computation is finished, the RWA has to file and submit GST returns by the due dates. This entails supplying data on the taxable amount, the quantity of GST received, and other required details.
Also Check: Apartment Maintenance Charges Calculation
GST on Society Maintenance: Filing Frequency and Compliance
A housing society is required to file 37 returns, with three returns per month that cover:
- Consolidated Return: 20th of the following month
- Expense Side: 15th of the following month
- Billing Side: 10th of the following month
- Annual Return GSTR 9 by the end of December following the current year
If a housing society deducts TDS, it must file GSTR7 by the 10th of the following month. Housing Societies are not part of the Composition Scheme.
Resident Welfare Associations are expected to maintain detailed records of all Supply and Expense reports for a period of 72 months for the purpose of audits.
Also Check: Guide to GST Invoicing for Housing Society
Simplify Society Maintenance with NoBrokerHood
NoBrokerHood’s Society Accounting Software is a digital financial management solution built for housing societies and RWAs. It simplifies all accounting, billing, expense tracking, transparency, and regulatory compliance tasks that are often difficult to manage manually.
| Feature Category | What It Does |
| Automated Billing & Maintenance Management | Generates monthly/quarterly invoices for maintenance, utility charges, and late fees automatically. |
| GST Control & Compliance | Allows toggling GST on/off per billing item, helping societies comply with GST rules while generating accurate invoices. |
| Multiple Charge and Billing Types | Handles various charge types, maintenance, utilities, penalties, sinking funds, etc. using flexible formulas. |
| Online Payments & Receipts | Residents can pay via UPI, debit/credit cards, net banking, wallets; system auto-records receipts. |
| Item-Wise Adjustments & Credits | Supports detailed adjustments, credits, and discounts by specific charge heads. |
| Cycle-Wise Accounting Entries | Tracks accounts by billing period for clearer financial history and audits. |
| Smart Reports & Reconciliation | Produces automated reports and helps match transactions with minimal effort. |
All Solutions by NoBrokerHood:
Summary
Hopefully, the article has helped to clarify the complexity of housing society’s GST implementation. But you should also be aware that the GST law can potentially apply to buildings that are under construction. The builder is in charge of timely GST collection and submission. Buyers should enquire if there is a legitimate GST number associated with the builder and whether he/she is submitting the amount that was charged by the buyers. It is essential to understand the particulars of the GST on maintenance charges if the flat association has been registered under the GST.
FAQs
Yes, it is. Should the services provided by the vendor fall within the scope of GST regulations, the society is obligated to fulfil its payment obligations according to the applicable tax rate. For instance, the GST amount for services provided by contractors.
It does, indeed. The upkeep costs of housing the society’s commercial areas are subject to GST. Commercial and residential properties are treated differently; the former must be paid at the correct GST rate since they are taxable supplies subject to GST.
No, they are not. The fees for transferring shares are considered taxable but are not taken into account within the Rs 7500 threshold since no third party is involved. Similarly, the interest charged for late payments is a personal fee, taxable but not within the Rs 7500 limit.
No, GST is not applicable in this scenario.
Upkeep fees up to Rs. 7500 per month per resident are GST-exempt. Previously, the exemption was available on a monthly upkeep fee of up to Rs. 5000 per resident. The limit was raised to Rs. 7500 starting from January 25, 2018.
GST is not applicable if the monthly maintenance per flat is up to ₹7,500 and the society’s turnover is below ₹20 lakh. Above this, 18% GST applies on taxable maintenance charges.