FAQ on Cooperative Society under GST Regime. FAQs on levy of GST on supply of services to the Co-operative society- reg. The power is one of the most important infrastructures which is important for economic growth and welfare of the nation. The introduction of GST is a significant step in the reform of indirect taxes in India.
It is one of the modern and significant tax reforms affecting economics and production. The implementation of GST is aimed to replace the taxes imposed by various taxes. It eliminates multiple taxes imposed by the States and the good and services will be cheaper. So, it helps to develop a common market in India.
| Question | Answer |
The society collects the following charges from the members on quarterly basis as follows:
From the tax/ charge as listed above, on which GST is not applicable. |
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| As per guidelines on maintenance charges upto Rs. 5000/- no GST is applicable. Maintenance charges means only maintenance or collection of all charges | This is applicable to only the reimbursements of charges or share of 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. Here, charges mean the indivisual contributions made by members of the society to avail services or goods by the society from a third party for common use. [*Entry 77(c) of notification no 12/2017 Central Tax (Rate) dated 28.6.2017 refers] |
| Monthly maintenance (all above charges) are below Rs.5000/-but yearly total collection exceeds Rs. 20 lakhs limit whether GST is applicable | Reimbursement of charges or share of contribution up to an amount of Rs. 5000/- per month per member for sourcing of goods or services from a third person for the common use is not liable to GST. However, if the Cooperative society/ RWAs provide specific services of its own to its members or to any third party (e.g. use of community hall for social function by a non-member) cumulatively exceeds the threshold limit as per GST, then GST is leviable on such supply of services. |
| At present we are following quarterly billing-whether we should change to monthly billing in view of the monthly return to be filed under GST Rules. | It is individual business decision. |
Recommended Articles*[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.]
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