Gst exemption for charges below ₹7,500 including funds
Querist :
Anonymous
(Querist) 18 March 2025
This query is : Resolved
As per, GST Notification No.12/2017 (Sr.No.77),as per these circulars, GST is applicable only if BOTH conditions are met simultaneously:
1. The society's annual turnover exceeds ₹20 lakhs, and
2. The monthly maintenance charges per member exceeds ₹7500.
Lets consider this QUATERLY Bill charged by our Society:
Maintenance Charges --> 5100
Sinking Fund --> 75
Repairs & Maintenance Fund --> 225
Major Repair Fund --> 255
Others - GST --> 100
Total --> 5755
As per the circulars mentioned above, the TOTAL amount is less than the monthly exemption of 7500/- and hence should be exempted. But the society has come up this theory that the exemption applies to Maintenance charges ie 5100 and not to the other service heads like Sinking funds, Repairs & Maintenance Fund & Major Repair Fund, and hence they are charging us since many years now.
Need clarification on this:
1) Does the exemption under Notification No. 12/2017-Central Tax (Rate), Entry 77(c), which states that services provided by a Residential Welfare Association (RWA) or Co-operative Housing Society are exempt from GST if the monthly contribution per member is below ₹7,500, include charges like Sinking Fund, Repairs & Maintenance Fund, and Major Repair Fund?
2) Or, do these funds (Sinking Fund, Repairs & Maintenance Fund, Major Repair Fund) fall under GST even if the total monthly bill is below ₹7,500?
Please help.
T. Kalaiselvan, Advocate 
(Expert) 18 March 2025
The maintenance charges paid by residents to the Resident Welfare Association are exempt up to Rs. 7,500. In case the amount charged exceeds Rs. 7,500 per month per member, GST is chargeable on the entire amount charged.
Repair and maintenance fund covers regular and routine maintenance and repairs of common areas and facilities, ensuring they remain in good condition.
Besides as far as the funds for major repairs and sinking funds are contributed by the RWA members to these funds through their monthly maintenance charges.Â
Therefore all these cover under monthly maintenance amount and anything beyond Rs. 7,500 attracts GST
P. Venu
(Expert) 21 March 2025
Sr. No. 77 of the Notification reads as follows -
"Service by an unincorporated body or a non- profit entity registered under any law
for the time being in force, to its own members by way of reimbursement of charges or share of contribution –
(a) as a trade union;
(b) for the provision of carrying out any activity which is exempt from the levy of
Goods and service Tax; or
(c) up to an amount of five thousand rupees per month per member for sourcing of goods or services from a third person for the common use of its members in a housing society or a
residential complex."
It appears that the facts are misunderstood.
