Vakil Help Desk News: an Authority for Advance Ruling has confirmed that resident welfare association maintenance up to ₹7,500 per member a month is exempt, but once the monthly collection per member exceeds ₹7,500, GST at 18% applies to the entire amount — not just the excess.
Vakil Help Desk News, Tax & GST. The ₹7,500 GST limit on society maintenance is a cliff, not a slab — a point every resident welfare association should understand. An Authority for Advance Ruling (AAR) confirmed how it works.
The question
An RWA whose annual collections exceed the ₹20 lakh registration threshold asked how GST applies to monthly maintenance collected from each member.
What the AAR held
- Maintenance up to ₹7,500 per member per month is exempt, where collected to source goods/services for the common use of the society.
- If the per-member monthly collection exceeds ₹7,500, GST at 18% applies to the entire amount, not merely the portion above ₹7,500.
- The total for this test includes periodic amounts such as sinking-fund contributions.
- Charges collected purely for electricity and water are not subject to GST.
Why it matters
Many societies miscalculate this. Crossing the ₹7,500 line even slightly makes the whole monthly amount taxable, so associations above the turnover threshold must plan their billing and GST compliance carefully.
What this means for you
Resident welfare associations should track monthly per-member collections closely: maintenance up to ₹7,500 is GST-exempt, but exceeding it taxes the entire amount at 18% (and sinking-fund contributions count towards the limit). If your society's turnover crosses ₹20 lakh, GST registration and correct billing are essential. We advise RWAs on GST registration, exemptions and compliance.