Reminder: GST Applies to Full Maintenance Bill Once It Crosses Rs 7,500

As societies across Maharashtra finalise revised maintenance budgets for FY 2026-27 -- many prompted by the equal-per-flat billing rule introduced under the MCS Amendment Rules 2026 -- committees are being reminded of a GST rule that continues to trip up managing committees: once a member's monthly contribution crosses Rs 7,500, GST at 18% applies to the entire amount, not just the portion above the threshold.

How the threshold works

Under CBIC's clarification (Circular No. 109/28/2019-GST), a housing society is required to charge 18% GST on maintenance contributions if two conditions are both met: the society's aggregate annual turnover exceeds Rs 20 lakh, and the monthly contribution collected from an individual member exceeds Rs 7,500. If a member pays exactly Rs 7,500 or less per month, no GST applies to that member's bill. But if the amount is even Rs 1 higher -- say Rs 7,501 -- GST is charged on the full Rs 7,501, not merely on the Rs 1 excess. This exemption is per member, per society, so a member with a larger flat paying more than the threshold is taxed while a neighbour below it is not.

What counts toward the Rs 7,500 figure

The threshold covers charges collected for common services -- general repairs and maintenance, sinking fund, security, housekeeping, and similar heads. It excludes statutory dues the society merely collects and passes through, such as municipal property tax and water charges billed as reimbursements. Societies should itemise these separately in maintenance bills so pass-through charges are not mistakenly clubbed into the taxable contribution figure.

What this means for housing societies

• Committees revising bills after the equal-charges rule under the MCS Amendment Rules 2026 should recheck whether the new flat per-member amount crosses Rs 7,500 -- a society that previously billed larger flats above the threshold and smaller flats below it may now find every flat taxed, or none at all, once charges are equalised.
• GST registration (SAC code 9995) is only required once the society's annual turnover, including taxable maintenance collections, exceeds Rs 20 lakh -- smaller societies remain outside GST even if individual bills exceed Rs 7,500.
• Input tax credit can be claimed by a registered society on GST paid to vendors (housekeeping agencies, security contractors, repair vendors), which can partly offset the GST charged to members.
• Charging GST on the entire bill rather than only the excess above Rs 7,500 is the single most common compliance error committees make, and can result in short collection that the society has to absorb later.

Societies unsure of their GST status should have their accountant review the FY 2026-27 budget alongside the revised per-flat maintenance figures before the next quarterly bill goes out, since incorrect GST treatment discovered later requires retrospective adjustment across all members.