GST (Goods and Service Tax) is ready to make its impact on Indian Economy from July 1st. So many questions are raising in different business sectors mind. How it will affect a business income? From past couple of years, rental business was on top of the food chain in Indian economy. People used to earn quite good income by this business. It usually comes into a start up or small business category. But the question is will the balance continue after induction of Goods and Service Tax (GST)? Let’s find out.
Effect of GST in Rental Business
As per the latest news, GST will have huge effect in real estate sectors, land and commercial properties. But in case of rental income, it has some pluses and minuses. Here is a small survey on before and after effect of GST on rental income.
In current tax regime, we found some important bullets which are quite important and put effects on Indian economy. Some of them are:
- Service Tax is not being charged on Renting of vacant land.
- The exemption limit of service tax is Rs. 10 Lakhs. Service tax is not mandatory of the price of services is less than Rs.10 Lakhs.
- Current Rate is 15%.
We may have some after effects of GST on rental business. Specially in property rental business, it has a major role, which can be defined as:
- Rental income on residential property will be exempted. House rentals are supposed to be increased after the direct impact of GST in real estate sector.
- The exemption limit will be Rs.20 lakhs. In some specified states, it will remain unchanged, i.e., Rs.10 lakhs.
- On Rental income, the rate of service will increase up to 18% (expected).
Why don’t you take the advantage of this upcoming GST? This is the perfect time to establish and grow your rental business. Visit RentSewa, the largest online rental portal and register yourself as vendor. Put your products on rent in this portal and start earning handsome money.