Clearing the Confusion on the 18% GST Rule for RWAs & Housing Societies
In recent weeks, social media and RWA (Resident Welfare Association) meetings have been buzzing with anxiety around an “18% GST” on monthly apartment maintenance charges. Many apartment residents are worried about a sudden hike in their monthly expenses. But here’s the truth: this GST rule is not new. It has been in place since 2019.
So why the sudden concern? Let’s break it all down — simply and clearly — so you know when GST applies, why it applies, and how it affects your monthly maintenance bill.
When Does GST Apply to Maintenance Charges?
Under the Goods and Services Tax (GST) Act, homeowners are required to pay 18% GST on monthly maintenance charges if both of the following conditions are met:
- Your monthly maintenance charge is more than ₹7,500, and
- Your society or RWA’s annual turnover exceeds ₹20 lakh
(or ₹10 lakh in some special category states)
If both of these conditions are met, GST is applicable on the full amount, not just the portion above ₹7,500.
Example: If your monthly maintenance is ₹9,000 and your RWA’s turnover is over ₹20 lakh/year, then you will pay 18% GST on ₹9,000, which is ₹1,620.
Your total monthly bill = ₹10,620.
Common Misconceptions: Let’s Bust Some Myths
🔹 Myth 1: “This is a new tax”
Fact: GST on apartment maintenance is not new. It has existed since 2017 and was clarified in 2019. The exemption limit was even raised from ₹5,000 to ₹7,500 in 2018 to benefit residents.
🔹 Myth 2: “GST is applicable even if my society’s turnover is below ₹20 lakh”
Fact: If the total turnover of your RWA is below ₹20 lakh in a financial year, GST is not applicable, even if the maintenance exceeds ₹7,500.
🔹 Myth 3: “Only the amount above ₹7,500 is taxed”
Fact: If both conditions are met, GST is charged on the entire amount, not just the difference.
What About People Who Own Multiple Flats?
For those who own more than one apartment in a society, the ₹7,500 exemption limit applies per apartment, not cumulatively. So if you own two apartments and each pays ₹7,000 in maintenance, GST is not applicable.
Why This Rule Exists: A Fair System with Benefits
While the idea of paying 18% more may sound like a burden, here’s what’s often missed — RWAs are entitled to Input Tax Credit (ITC) under GST.
This means RWAs can claim credit for the GST paid on goods and services they buy for society maintenance — like:
- Capital goods (generators, pumps)
- Repair services
- Plumbing, electrical fittings, sanitation work, etc.
So in the post-GST era, many RWAs are actually saving money that used to be a cost during the VAT period.
Final Takeaway for Homeowners
If you’re seeing GST added to your maintenance bills, don’t panic. First, check these two things:
- Is your monthly maintenance above ₹7,500?
- Is your RWA’s annual turnover above ₹20 lakh?
If the answer is yes to both, GST is correctly applied — and it’s not a new rule. If your society is below the ₹20 lakh threshold, GST should not be charged, even if your charges are higher.
How to Handle This as a Resident
- Ask your RWA to disclose its annual turnover transparently.
- Check if they are registered for GST (they must have a GSTIN).
- Ensure you get a GST invoice with the maintenance bill.
- Ask about how your RWA is using Input Tax Credit to reduce society costs.
Stay Informed. Stay Smart.
At My Realestate Services MRE , we believe every homeowner deserves to understand how government policies affect their wallet — without jargon or confusion. We hope this blog helped you see the bigger picture behind GST on apartment maintenance.
Still have questions about your housing society or GST rules? Drop us a message, and we’ll help you get clarity.
