Trade and industry in Coimbatore that have taken shops on rent in buildings owned by the Coimbatore Corporation face issues because of lack of clarity on GST paid for the rent.
According to sources in the trade, those who have taken space on rent in the Corporation buildings pay the rent and 18% GST on the citizen web portal. They are bound to pay reverse charge tax to the GST department directly.
According to the GST rules, for the services offered by the Central government, State government, Union Territory, or local body authority by way of renting out immovable property to a person registered under the CGST Act, those registered with the Act should pay the GST on reverse charge basis.
Now, the trade or industry that has taken the space on rent is paying GST to the Corporation and to the GST Commissionerate.
The Corporation should not raise demand for GST on rent, they said.
A senior Corporation official said, “GST on rent is collected from all tenants of our commercial complex, as this rental income is subject to GST, which we are required to pay. Therefore, we collect the GST and issue rent receipts to each tenant. The GST is managed through the UTIS (Urban Tree Information System) software. However, there remains some confusion between the Corporation and traders regarding GST, which needs to be resolved at the level of the Directorate of Municipal Administration (DMA) and the GST department heads.”
