In accordance with Notification No. 12/2017-CT(R) dated 28th July 2017, services by way of renting residential property to both registered or unregistered persons are exempt under GST.
However, w.e.f 18.07.2022 entry no. 5AA is added through Notification No. 05/2022-CT(R) dated 13.07.2022), where exemption has been restricted only to unregistered persons. Accordingly, if a residential property is rented to a registered person, GST shall apply at @18% under the reverse charge method. Therefore, the service receiver i.e. the tenant is liable to pay tax under reverse charge. ITC can be availed for the abovesaid services.