When GST applies to rent received on commercial property, and who is liable to pay it.

By Kanoons · 5 min read · Last verified 2025-03-27

Renting out a commercial property is a taxable supply of services under GST, and the landlord is liable to charge and collect GST on the rent once their aggregate turnover (including this rental income) crosses the standard registration threshold — this catches many individual landlords by surprise since they don't think of themselves as "running a business."

Residential property let out for residential use remains exempt, but commercial premises — office space, shops, warehouses — do not get that exemption regardless of who the tenant is, and the current rate applicable to commercial rent is 18%, charged on the total rent under a standard forward-charge basis in most cases.

Landlords who are already GST-registered for other reasons need to include rental income in their regular returns; landlords who cross the threshold purely because of rental income need to register specifically for that. Either way, invoicing the tenant correctly with GST shown separately, and passing on a valid tax invoice, is what allows a GST-registered tenant to claim input tax credit on the rent they've paid.