Goods and Services Tax (GST) is charged on maintenance fees because housing societies and RWAs provide organised services such as security, housekeeping, repairs, and upkeep of common areas. From a tax perspective, these activities are treated as a supply of services.
Understanding the GST on apartment maintenance is essential for flat owners and RWAs, as it affects monthly costs, compliance responsibilities, and billing transparency. Clear awareness helps residents know when GST applies and enables RWAs to manage collections and filings correctly.
Key Takeaways
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GST applies only when both limits are crossed. ₹7,500 per member per month and a ₹20 lakh annual turnover of the RWA.
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Once applicable, GST is charged on the full maintenance amount, not just the excess over ₹7,500.
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ITC is available only to GST-registered RWAs that collect GST and maintain proper invoices.
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Clear compliance ensures transparent billing and helps residents understand why GST is charged.
What Are Apartment Maintenance Charges?
Apartment maintenance charges are periodic fees collected by a housing society or Residents’ Welfare Association (RWA) to manage standard services and shared facilities within a residential complex. These charges support the regular functioning and upkeep of shared infrastructure used by all residents.
Common Services Covered
Maintenance charges typically include security personnel costs, housekeeping staff, cleaning of common areas, and operation and servicing of lifts. These services help to ensure safety, hygiene, and smooth movement within the premises.
Utilities and Infrastructure Upkeep
Charges may also cover electricity used in common areas such as staircases, corridors, parking spaces, and clubhouses. Power backup systems, water supply management, plumbing, and minor electrical repairs are typically part of this category.
Repairs and Administrative Costs
Routine repairs, preventive maintenance, gardening, and landscaping are other categories often included. To that, add administrative costs, including accounting, auditing, and office-related expenses.
Understanding these components is essential because apartment maintenance GST will depend upon the nature and value of services that form part of the maintenance charges.
Also Read More about: What is GST and Types of GST?
Exemption Limit for Housing Societies & RWAs
Understanding the exemption limits helps clarify when is GST applicable on apartment maintenance charges and when societies are required to levy tax.
Monthly Maintenance Exemption Limit
Apartment maintenance charges are exempt from GST when the contribution does not exceed ₹7,500 per month per member. If the monthly amount stays within this limit, no GST is charged on maintenance for that member.
Turnover Threshold for GST Registration
Apart from the per-member limit, the applicability of GST also depends on the society's total annual turnover. In fact, GST becomes relevant only if the aggregate turnover exceeds ₹20 lakh in a financial year. For societies in special category states, the limit is ₹10 lakh.
When GST Becomes Applicable
GST applies when both conditions are met together—the monthly maintenance exceeds ₹7,500 per member, and the society’s turnover crosses the prescribed threshold. Once applicable, GST is charged on the full maintenance amount, not just the excess portion.
These conditions explain clearly if GST is applicable to apartment maintenance charges and help residents and RWAs understand how exemption limits work in practice.
When GST Becomes Compulsory for RWAs
Such GST registration and collection by an RWA are compulsory only upon the fulfilment of certain conditions. These are the apartment maintenance GST rules in order to see that tax is applied only to large societies with large collections.
Key Conditions for GST Applicability
GST becomes compulsory when both of the following conditions are met:
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The RWA’s aggregate annual turnover exceeds ₹20 lakh in a financial year.
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The monthly maintenance contribution per member exceeds ₹7,500.
If either condition is not met, GST is not applicable to apartment maintenance charges.
Practical Examples
If an RWA collects ₹6,500 per month from each member but its annual turnover crosses ₹20 lakh, GST will still not apply due to the per-member exemption. On the other hand, if the monthly contribution is ₹8,500 per member and the total turnover also exceeds ₹20 lakh, GST becomes compulsory and is charged on the entire maintenance amount.
Understanding these GST rules for apartment maintenance helps RWAs ensure compliance and allows residents to clearly interpret when GST appears on their maintenance bills.
Input Tax Credit (ITC) Rules for RWAs
Input Tax Credit (ITC) explains how GST paid by a Residents’ Welfare Association (RWA) on expenses can be adjusted against the GST collected from residents. Under GST for apartment maintenance, ITC applies only when the RWA is registered and charging GST.
Eligibility to claim ITC
RWAs can claim Input Tax Credit only if they are registered under GST. Societies that fall within the exemption limits or are not registered cannot avail ITC benefits.
Services eligible for ITC
ITC will be available for GST paid on common area maintenance services like security, housekeeping, lift maintenance, repairs, plumbing, electrical, and other similar shared facilities if the same are used for providing taxable maintenance services.
Conditions for claiming ITC
The expenses must be supported by valid tax invoices, and the services should be directly linked to maintenance activities on which GST is collected from residents.
Impact on residents’ maintenance charges
When ITC is utilised, the GST paid on input services is adjusted against the GST collected, reducing the overall tax burden and preventing double taxation.
Also Read More About: Input Tax Credit (ITC) under GST
Calculation Example: How GST on Maintenance Is Computed
Understanding GST on apartment maintenance becomes easier with a simple calculation example based on the current rules.
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Monthly maintenance charged per member: ₹8,000
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RWA’s annual turnover: Above ₹20 lakh
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GST registration status: Registered under GST
Because the monthly contribution per member exceeds ₹ 7,500 and the RWA's turnover exceeds the threshold limit, it attracts GST. In such a case, the entire amount of maintenance collection, and not just the amount exceeding ₹ 7,500, attracts GST.
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Taxable value: ₹8,000
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GST rate on maintenance services: 18%
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GST amount: ₹1,440
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Total payable by the member: ₹9,440
If either condition had not been met—such as maintenance being ₹7,500 or below, or the RWA’s turnover remaining under ₹20 lakh—GST would not apply. This example clearly shows how GST on apartment maintenance is calculated once the exemption limits are crossed.
GST on Additional Charges
Apart from regular maintenance, RWAs often collect additional charges for specific purposes. Understanding how GST rules for apartment maintenance apply to these amounts helps avoid confusion in billing.
Parking charges
Parking fees collected for common parking areas are generally treated as part of the overall maintenance services. If GST applies to the RWA, parking charges are also taxable at the same rate.
Facility usage fees
Charges collected for the use of shared facilities such as clubhouses, community halls, or sports amenities are considered a supply of services. When the RWA is liable to charge GST, these fees also attract GST.
Sinking fund and repair fund
Sinking fund or major repair fund contributions are taxable only when they form part of the consideration for maintenance services and are intended to be used for future taxable supplies.
This position was recently confirmed by the Tamil Nadu Authority for Advance Rulings (AAR) in May 2025, which stated that sinking fund amounts collected by a GST-registered RWA are treated as part of maintenance charges and are taxable once GST conditions are met.
However, one-time corpus contributions collected exclusively for capital assets and not connected to maintenance services may fall outside GST. In all cases, GST does not apply if the RWA remains within the exemption limits.
Reverse Charge Mechanism (RCM) for RWAs
Under GST for apartment maintenance, the Reverse Charge Mechanism (RCM) shifts the responsibility of paying GST from the service provider to the recipient, in this case, the RWA. This applies only to specific notified services.
When RCM applies
RCM is commonly applicable when RWAs receive services from a transporter for goods transported by road, legal services by an individual advocate, and certain services related to sponsorship. In all these cases, the RWA needs to pay GST directly to the government and not the service provider.
Registration requirement
If an RWA is required to pay GST under RCM, GST registration becomes mandatory, even if the society is otherwise below the turnover threshold.
Impact on maintenance charges
GST paid under RCM cannot be collected from vendors, but can be factored into overall maintenance costs. If the RWA is registered, then the GST paid under RCM may be claimed as Input Tax Credit, subject to conditions.
This helps RWAs stay compliant while managing GST for apartment maintenance correctly.
Impact of GST on Residents: Benefits & Concerns
GST on apartment maintenance charges influences both the cost and clarity of monthly bills for residents. Its impact can be understood by looking at the benefits and concerns separately.
Benefits for Residents
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More clarity in the breakdown of maintenance bills regarding service charges and taxes.
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More accountability from RWAs because of structured invoicing and record-keeping.
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The process provides clarity on the tax rules and enables residents to clearly identify when goods are subject to GST and when they are exempt.
Concerns for Residents
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Higher monthly outflow once GST is applicable beyond the exemption limits.
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Confusion about applicability, particularly in societies at or around threshold limits.
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Limited control over charges, as GST becomes compulsory once conditions are met.
Overall, GST improves clarity but may increase costs when GST on apartment maintenance charges applies.
Common Misunderstandings About GST on Maintenance
Splitting maintenance bills avoids GST
Breaking maintenance into separate heads or issuing multiple bills does not bypass GST if the actual monthly contribution per member crosses the limit.
GST applies only to the amount above ₹7,500
Once GST becomes applicable, it is charged on the full maintenance amount, not just the excess portion.
GST applies even if turnover is low
GST is not applicable unless both conditions are met—per-member charges exceed ₹7,500, and the RWA’s annual turnover crosses the threshold.
All RWAs can claim Input Tax Credit
ITC is available only to GST-registered RWAs that charge GST; exempt or unregistered societies cannot claim it.
Sinking fund and similar charges are always exempt
If these charges form part of taxable maintenance services, GST may still apply.
Clearing these misconceptions helps residents better understand apartment maintenance GST and reduces confusion around billing and compliance.
Compliance Tips for RWAs & Committee Members
Following GST rules for apartment maintenance becomes easier when basic compliance practices are handled correctly and consistently.
Register only when required
Check both conditions, annual turnover and per-member maintenance amount, before applying for GST registration. Avoid unnecessary registration if exemption limits are not crossed.
Use GSTIN correctly on bills
Once registered, ensure the GSTIN is clearly mentioned on all maintenance invoices issued to residents.
Issue proper tax invoices
Maintenance bills should clearly show the taxable value, GST rate, GST amount, and total payable. Clear break-ups help prevent confusion and disputes.
File returns on time
Regular and timely filing of GST returns is essential to remain compliant and avoid penalties or notices.
Maintain supporting records
Maintain a proper record of invoices, proofs of payment, contracts with vendors, and records of expenses. Good documentation supports compliance and helps during audits or clarifications.
Simple, consistent practices have made compliance smooth in the case of apartment maintenance under GST and reduced the possibility of errors.
Conclusion
Understanding the rules of GST regarding apartment maintenance aids RWAs and residents alike in managing charges with clarity. Proper compliance ensures transparent billing, correct tax collection, and timely filings, reducing the risk of errors or disputes.
This helps residents understand precisely when GST is applied, thereby explaining increases in their month-on-month outgoings and instilling confidence in how charges are calculated. In general, clear awareness of the GST provisions will support better financial planning and accountability, leading to smoother day-to-day management in housing societies.
