A housing society in Mumbai operates under a GST framework that is frequently misunderstood by managing committees. The society must register if aggregate turnover exceeds ₹20 lakh, or if the maintenance charge exceeds ₹7,500 per member per month and the turnover condition is met. The ₹7,500 exemption applies to maintenance contributions for common-use sourcing, not to transfer fees, sinking funds, parking charges or clubhouse charges, each of which has its own character.
The Threshold and the Exemption
The CBIC Circular No. 109/28/2019-GST states that where the maintenance charge exceeds ₹7,500 per member per month and the society is registered, GST applies to the entire maintenance amount, not merely the excess. This position is contested. The society should compute aggregate turnover across maintenance, transfer fees, sinking funds, parking and other income, and should not assume that a maintenance charge below ₹7,500 means no registration obligation.
The Transfer Fee and Sinking Fund
A transfer fee is a separate taxable supply, not maintenance. A sinking fund contribution is contested: the Karnataka AAR has taken the advance-for-services view, while the capital-receipt position remains arguable. The society should document its chosen position and apply it consistently.
The Notice Triggers
A society notice commonly arises from a transfer fee or sinking fund that was not reported, a maintenance charge that crossed the threshold, or an ITC claim on society expenses that was not supported. The society should maintain the resolution, the fund purpose, the invoices and the returns.
What the Consultant Does
The consultant assists with the threshold computation, the transfer-fee and sinking-fund characterisation, the ITC review and the notice response. The value is in the consistent documentation that supports the society’s chosen GST treatment.
Call to Action: We advise Mumbai housing societies on GST thresholds, transfer fees, sinking funds and notice defence. For a society-specific review, contact office@anujdesaiassociates.com, Ph No. 9619456656, Website https://anujdesaiassociates.com, LinkedIn linkedin.com/in/ca-anuj-desai-122547230.