No GST upto Rs 7500 paid per month by Members to RWAs
By TIOL News Service
NEW DELHI, JAN 23, 2018: AT its 25th Meeting the GST Council recommended several measures granting relief from GST and one of the important reliefs is to enhance the limit of contribution made by members of a Resident Welfare Association for the purpose of exemption from GST.
Services provided by Resident Welfare Associations (unincorporated body or a registered non-profit entity) to their members were hitherto exempt against contribution of upto an amount of Rs 5000/- per month per member. Requests were received from several quarters to enhance the contribution limit.
The Council has recommended that the limit may be enhanced to Rs.7500/- per month per member. As a result, RWAs shall be required to pay GST on monthly subscription/contribution charged from its members if such subscription is more than Rs. 7500 per member and the annual turnover of RWA by way of supplying of services and goods is also Rs. 20 lakhs or more. Under GST, the tax burden on RWAs will be lower for the reason that they would now be entitled to ITC in respect of taxes paid by them on capital goods (generators, water pumps, lawn furniture etc.), goods (taps, pipes, other sanitary/hardware fillings etc.) and input services such as repair and maintenance services.
ITC of Central Excise and VAT paid on goods and capital goods was not available in the pre-GST period and these were a cost to the RWA.
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