Registration of multiple companies at same address under GST? (Kerala AAR -In case of M/s Spacelance Office Solutions Pvt. Ltd.)

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As we all know for GST registration we need to register a place as principal place of business which can be either rented, owner or taken on consent and as we all know one cannot have two separate people running the business at same place unless there is a proper demarcation of that place in two parts and both space have their separate identity and generally when many companies are running from same address they are mostly shell companies as per traditional belief. However, in modern times a new philosophy of co-working space has come up under which many business work at single address and are assigned separate tables or cabins or space to run their companies at very less cost and it helpful for start ups and companies which occasionally need office space for some special meeting.

The AAR mentioned above is in relation to a co working space which is provided on rent to various companies and the issue was raised when one of the companies went on to register it’s company with GST and the registration was rejected because of the reason that a company was already registered at the same address. Now in such cases of co-working space companies are just allotted separate desk number or cabin whereas the main address was the same and hence registration was rejected. Against this rejection the owner of the co working space went before AAR to ask if multiple companies can register on same address as it’s the modern way of doing business and in such Advance ruling it was said that:

The traditional office culture is being overshadowed by shared office space culture. The phenomenon of these co-working spaces have thrived significantly as this is the only option for start up founder to start opening businesses at a lesser cost than a normal corporate office.

There is no prohibition under GST law for obtaining GST registration to a shared office space or virtual office, if the land lord permits such sub leasing as per the agreement. Each co-working space is demarcated with separate suit number or desk number. As the GST registration is based on PAN, identification of tax payer is not a difficult thing. While applying for GST registration for the co-working space the rental agreement with the land lord and lessee along with the agreement between lessee and sub lessee must be uploaded as a proof of address of principal place of business of respective suit or desk number. In addition to this upload monthly utility bill in connection with payment towards electricity charges, water charges, or other common services availed by respective suit or desk number. The GST number assigned to each company working in the co-working space must be mentioned at one common place and books of accounts of such person should be maintained at principal place of business either manually or electronically.

As per the above Advance ruling multiple companies/ startup can register at one place who are mostly engaged in providing service and they need the following documents for their GST registration:

1. Rent deed between owner and lessee and rent agreement between lessee and sub lessee i.e. owner of start up company.
2. Utility bill of recent month related to his desk or cabin in co-working space.

You can download the Advance ruling order here: Order

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