Room Rent HSN Code: A Fast-Track Guide for Landlords: 1 Minute to Understand Room Rent HSN Code for Tax Compliance

If you’re a landlord navigating the complexities of tax compliance in India, understanding the HSN code for room rent is essential. The HSN (Harmonized System of Nomenclature) code is a globally recognized system for classifying goods and services under GST (Goods and Services Tax), ensuring uniformity in taxation. However, many landlords are unsure whether rental income even requires an HSN code, or how room rental fits within India’s GST framework. Here’s a fast-track guide to help clarify these points so you can manage your rental property business smoothly.

Room Rent and HSN Code: The Essentials

Under India’s GST law, services such as room rentals typically fall under the Service Accounting Code (SAC), not HSN. For residential property rental (including individual room rentals to tenants), rental income is generally exempt from GST, and thus, there is no need to mention an HSN code on invoices or bills for standard residential rents. Specifically, Service Code 997211 pertains to “rental or leasing services involving own or leased residential property,” which is exempt from GST liability unless the property is used for commercial purposes.

If you provide room rental in a commercial context, such as hotels, inns, guest houses, or serviced apartments, you may need to use codes such as 9963 (Accommodation services). In these cases, GST is applicable depending on the tariff and property type, and specifying the correct HSN/SAC code becomes necessary for billing and compliance.

Why It Matters for Landlords

As a designer and someone who values structuring both physical spaces and business processes efficiently, getting your billing and documentation right is as crucial as selecting the perfect paint palette. For those dealing with rental properties outside traditional residential leases—like guesthouses for short-term stays or co-living spaces—the correct categorization ensures your rentals remain both appealing and compliant. If you’re furnishing and showcasing your rooms, leveraging digital tools like a room planner can help you optimize layouts and present the property attractively to tenants while keeping track of the business details that matter.

Tips 1:

Keep documentation: Always maintain up-to-date invoices and lease agreements to streamline record-keeping and ensure compliance if you branch into taxable rental services.

Use smart tools: Platforms that help you plan, design, and even digitally stage your property are invaluable not only for attracting tenants but also for maintaining records which may be required for GST or other regulatory audits.

FAQ

Q: Is there an HSN code required for renting out residential rooms in India?

A: No, residential room rent falls under GST-exempt services and uses SAC 997211, not an HSN code.

Q: When does GST apply to room rentals?

A: GST is applicable when renting out property for commercial purposes, such as hotels or serviced apartments.

Q: What is the SAC code for commercial room/accommodation rental?

A: The SAC code is typically 9963 for accommodation services under GST.

Q: Do landlords have to issue GST invoices for residential room rent?

A: No, residential room rentals are generally exempt from GST, so GST invoices and HSN codes are not required.

Q: How can landlords optimize rental property presentation for higher occupancy?

A: Using a digital room planner allows you to design appealing layouts, helping attract tenants and improve overall rental value.