GST on Mumbai Housing Society Maintenance: The Rs 7,500 Rule and What Is Excluded

The resale flat is in a cooperative housing society in the western suburbs, and the seller hands over a quarterly maintenance bill to show what living there costs. It lists property tax and water tax payable to the Municipal Corporation of Greater Mumbai, a sinking fund, a repairs fund, car parking charges and a non-occupancy charge. Somewhere in that list is the answer to a question many Mumbai buyers never ask before signing: will the society add GST to my monthly bill, and on how much of it?

The Central Board of Indirect Taxes and Customs answered that question in a buyer-friendly flyer, GST on Housing Societies, hosted on the GST Council website. It even uses a Mumbai example. This guide reads the flyer, CBIC's earlier press release on RWA services and a 2023 West Bengal advance ruling that records how courts have treated the rule. It is buyer guidance on running costs, not tax advice.

The short answer. The CBIC flyer says a housing society's charges to members are exempt from GST up to Rs 7,500 per month per member, for sourcing goods or services from a third person for the common use of members. Statutory dues such as property tax and electricity charges collected through the bill are excluded when calculating that limit. If the society's turnover is under Rs 20 lakh, it need not register at all. Where the monthly contribution exceeds Rs 7,500, the flyer says GST applies on the entire amount, not just the excess. The trade-off: excluding statutory dues keeps many bills under the limit, but sinking fund, repairs fund and parking charges sit in the taxable column of the flyer's example, so a well-funded society with higher contributions can push members over Rs 7,500 and bring GST onto the whole common-use amount.

Does GST apply to a Mumbai housing society at all?

In principle, yes. The flyer explains that under Section 2(17)(e) of the CGST Act, 2017, provision by a club, association, society or similar body of facilities or benefits to its members for a subscription is deemed to be business. It also notes that the definition of person in Section 2(84) specifically includes a cooperative society. So the activities of a housing society attract the levy of GST, and a society may need to register.

The flyer also quotes Section 2(16) of the Maharashtra Co-operative Societies Act, 1960, which defines a housing society as one whose object is to provide members with plots, houses or flats, or, if those are already acquired, to provide common amenities and services. That is the typical Mumbai cooperative housing society a resale buyer joins.

When does a society have to register for GST?

Above Rs 20 lakh of turnover. The flyer says that if the turnover of a housing society is above Rs 20 lakh, it needs to take registration under Section 22 of the CGST Act. It adds that taking registration does not mean the society has to compulsorily charge GST in the monthly maintenance bills raised on members, because of the exemption described below.

The flyer also says that if a society's turnover is below Rs 20 lakh, or if it is above Rs 20 lakh but the monthly contribution of each member towards maintenance is below Rs 7,500 and the society provides no other taxable service, it need not take registration under GST.

What is the Rs 7,500 rule?

A per-member monthly exemption. The flyer quotes entry 77 of Notification No. 12/2017-Central Tax (Rate), which exempts services by an unincorporated body or a non-profit entity to its own members by way of reimbursement of charges or share of contribution up to an amount of Rs 7,500 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 residential complex.

CBIC's earlier press release, issued when GST began, used a figure of Rs 5,000 per month per member. The West Bengal ruling records that the limit was raised to Rs 7,500 through Notification No. 2/2018-Central Tax (Rate), dated 25 January 2018. The same ruling refers to CBIC Circular No. 109/28/2019 dated 22 July 2019 on the same subject.

Is GST charged on the whole bill or only the excess?

This is where the rule has been contested. The flyer's own example takes a monthly bill of Rs 9,000 for services for common use of members and says that exemption is available up to Rs 7,500 and GST would be applicable on the entire Rs 9,000, not on the Rs 1,500 in excess. The 2023 West Bengal ruling says Circular No. 109/28/2019 also states that GST is payable on the entire amount where the limit is exceeded.

Courts have taken a different view at least once. The same West Bengal ruling records that a single judge of the Madras High Court, in Greenwood Owners Association versus Union of India, held that only contributions in excess of Rs 7,500 would be taxable, and quashed the circular to the extent it said otherwise. The ruling then records that a Division Bench of the Madras High Court, while admitting the Revenue's appeal in a related case, stayed that portion of the single judge's order until further orders. That is the position as the ruling described it in November 2023, so ask your society's accountant which method it follows now.

Which parts of a Mumbai maintenance bill are outside the limit?

Statutory dues. The flyer says charges collected by the society on account of property tax, electricity charges and other statutory levies are excluded while calculating the Rs 7,500 limit. In its Mumbai worked example, it lists property tax and water tax for MCGM, non-agricultural tax for the Maharashtra government and electricity charges as items on which GST is not leviable when collected from individual flat owners.

The same example says sinking fund, repairs and maintenance fund, car parking charges, non-occupancy charges and simple interest for late payment attract GST, because they are collected by the society for supply of services meant for its members. If electricity charges are collected for power from the society's generator, or for providing drinking water or another service, the flyer says those charges are liable to GST.

Does GST make society costs higher than before?

CBIC said no when GST began. Its press release on RWA services called reports that housing society services would become expensive under GST completely unsubstantiated. It said that under GST the tax burden on RWAs would be lower because they would be entitled to input tax credit on taxes paid on capital goods such as generators, water pumps and lawn furniture, on goods such as taps and pipes, and on input services such as repair and maintenance. The flyer's conclusion repeats that point and says the exemptions ensure there is no tax burden on smaller societies where the monthly contribution of individual members does not exceed Rs 7,500. Whether your society actually claims that credit is a question for its managing committee and accountant.

How should a resale buyer read the bill?

Split it into two columns. Put statutory dues in one, and everything collected for the society's own services in the other. Then compare the second column, per month, with Rs 7,500, and ask whether the society is registered for GST. As an illustration, take a monthly bill of Rs 12,000 in which Rs 3,000 is property tax and water tax for MCGM. The statutory Rs 3,000 is excluded, leaving Rs 9,000 for the society's own services. That is above Rs 7,500, so on the flyer's reading GST would apply to the full Rs 9,000 if the society is registered. Our guides on maintenance, corpus and sinking funds and on who pays maintenance before the association takes over explain where these funds come from in a new project. If you are a non-occupant owner planning to let the flat, note that non-occupancy charges are in the taxable column in the flyer's example.

A seven-point checklist on society GST before buying a resale flat

1. Ask the seller for the last four maintenance bills and the society's latest audited accounts.
2. Separate property tax, water tax, non-agricultural tax and electricity dues from the rest.
3. Add up the remaining monthly charges per member and compare with Rs 7,500.
4. Ask whether the society is registered for GST and whether its turnover exceeds Rs 20 lakh.
5. Check whether GST on the bill is computed on the full amount or only the excess over Rs 7,500.
6. Note sinking fund, repairs fund, parking and non-occupancy charges, which the flyer treats as taxable.
7. Budget the GST line, if any, into your monthly cost of ownership before agreeing a price.

Frequently asked questions

Do Mumbai housing societies charge GST on maintenance?

Only in some cases. The CBIC flyer on housing societies says contributions up to Rs 7,500 per month per member, for goods or services sourced for common use, are exempt. A society with turnover below Rs 20 lakh need not register. GST arises where the contribution exceeds Rs 7,500 and the society is registered.

Is property tax included in the Rs 7,500 limit?

No. The CBIC flyer says charges collected by the society on account of property tax, electricity charges and other statutory levies are excluded while calculating the Rs 7,500 limit. In its Mumbai example, property tax and water tax for MCGM and non-agricultural tax are items on which GST is not leviable.

If my bill is Rs 9,000, is GST on Rs 9,000 or Rs 1,500?

The CBIC flyer says GST would apply on the entire Rs 9,000. A Madras High Court single judge held only the excess is taxable, but a 2023 West Bengal advance ruling records that a Division Bench stayed that part of the order. Ask your society which method it follows.

Does the sinking fund attract GST in a housing society?

According to the CBIC flyer's Mumbai example, sinking fund, repairs and maintenance fund, car parking charges, non-occupancy charges and simple interest for late payment attract GST, because they are collected by the society for supply of services meant for its members.

Last updated 2026-11-05. PropNewz Team.