GST for Manpower & Facility Services – Complete Guide to Rates, TDS, RCM & Compliance
Your central hub for every GST compliance requirement across the manpower and facility services sector — security agencies, housekeeping, manpower supply, facility management, pest control, recruitment, specialized cleaning, and home services platforms. Rates, TDS sections, RCM rules, ITC, and compliance deadlines — all in one place.
Quick Summary – GST for Manpower & Facility Services
- Scope: Complete GST framework for the manpower and facility services sector — security, housekeeping, manpower supply, facility management, pest control, recruitment, specialized cleaning, and home services marketplaces.
- Rate: All services are taxable at 18% GST — no exemptions apply in this sector.
- TDS Split: Most services are 194C at 2% (works contracts). Recruitment is 194J at 10% (professional service).
- RCM Applicability: Applies on sub-contracted manpower, security, and housekeeping from unregistered vendors. Does NOT apply to recruitment services.
- Section 9(5) for Home Services: Housekeeping via home services platforms is notified under 9(5) — platform pays GST as deemed supplier. Beauty, repair, and other services follow the standard ECO model with 1% TCS.
- Registration Threshold: ₹20 Lakh (normal states) / ₹10 Lakh (special states). No threshold for e-commerce operators and aggregator platforms.
- ITC: Full ITC on equipment, chemicals, software, and RCM sub-contracts. NO ITC on wages paid to deployed staff.
- Common Compliance: GSTR-1, GSTR-3B, GSTR-8 (TCS for platforms), TDS 194C/194J/194-O, and RCM self-invoices.
Takeaway: The manpower and facility services sector is not one compliance model — it is a family of related but distinct models. This page connects you to the exact guidance for each service category.
1. What is GST for Manpower & Facility Services? (Overview)
GST for manpower and facility services is the tax framework that applies to businesses providing labour, staff, and facility support services to corporate and residential clients. The sector has a complex compliance landscape because it operates across several different business models:
Every service in this sector is taxable at 18% GST. The complexity lies in TDS classification, RCM applicability, and composite supply treatment — not in the GST rate itself.
Takeaway: The GST rate is uniform at 18% — but the compliance obligations differ dramatically across service types. Know your specific business model to stay compliant.
2. Is GST Applicable to Manpower & Facility Services in India?
Yes — GST applies to all manpower and facility services at 18%. There is no blanket exemption for any service category in this sector, with the narrow exception of agricultural pest control.
GST Rate Matrix Across the Sector
| Service Category | GST Rate | ITC |
|---|---|---|
| Security Agencies | 18% | Available |
| Housekeeping Agencies | 18% | Available |
| Manpower Agencies | 18% | Available (except wages) |
| Facility Management (IFM) | 18% | Available |
| Pest Control | 18% | Available (except exempt agri) |
| Recruitment Agencies | 18% | Available |
| Specialized Cleaning | 18% | Available |
| Home Services Platforms | 18% (commission) | Available |
| Agricultural Pest Control | Exempt | Not available |
Why the Exemption is Narrow
- No Blanket Exemption: Only specific agricultural pest control services (plant protection for crops, warehouse fumigation) are exempt. Everything else is 18%.
- Recipient's Exemption Does Not Flow: Cleaning a hospital or school does not make your service exempt — the exemption applies only to the hospital's or school's own services.
- Government Contracts are Taxable: Providing manpower or security to a government department is 18% taxable.
Takeaway: Every rupee billed in this sector is 18% taxable — the only carve-out is agricultural pest control.
3. What TDS Section Applies to Manpower & Facility Services? (194C vs 194J)
Most of the sector falls under TDS Section 194C at 2%. Recruitment is the exception — it falls under Section 194J at 10% because it is a professional service.
TDS Classification by Service Type
| Service | TDS Section | Rate |
|---|---|---|
| Security Guard Deployment | 194C | 2% |
| Housekeeping Services | 194C | 2% |
| Manpower Supply | 194C | 2% |
| Facility Management | 194C | 2% |
| Specialized Cleaning | 194C | 2% |
| Pest Control | 194C | 2% |
| Recruitment / Placement | 194J | 10% |
| Executive Search / IT Staffing | 194J | 10% |
The 194C vs 194J Split
- 194C (2%): Applies to works contracts and labour supply — where the service is defined by deliverables and ongoing deployment.
- 194J (10%): Applies to professional/technical services — recruitment, executive search, and skilled IT placement.
- Cash Flow Impact: The 8% difference between 194C and 194J has a significant impact on working capital — especially for high-value recruitment deals.
• Recruitment: TDS 194J at 10% = ₹15,000
• Manpower: TDS 194C at 2% = ₹1,200
Two invoices, two TDS sections — clarify with the client upfront.
Takeaway: Recruitment is 194J at 10% — everything else is 194C at 2%. This is the single most important TDS distinction in the sector.
4. Explore GST Guides by Manpower & Facility Service Type
Select your specific service category below to access the complete GST compliance guide:
GST for Security Agencies
18% rate, TDS 194C at 2%, RCM on sub-contracted guards, ITC on uniforms, and event security compliance.
GST for Housekeeping Agencies
Hospital exemption myth, TDS 194C at 2%, RCM on sub-contracted cleaners, and SAC 998533 invoicing.
GST for Manpower Agencies
18% rate, TDS 194C for labour supply, ITC exclusions on wages, and CLRA compliance.
GST for Facility Management Business
Composite supply treatment, multi-site invoicing, TDS 194C at 2%, and mixed-service compliance.
GST for Pest Control Business
18% rate, agricultural exemption, TDS 194C at 2%, RCM on sub-contracted fumigation, and chemical ITC.
GST for Recruitment Agency
TDS 194J at 10% (not 194C), no RCM, free replacement handling, and overseas placement exports.
GST for Cleaning Services
Correct SAC codes (998533/998534/998535), heavy equipment ITC, façade and industrial cleaning compliance.
GST for Home Services Platforms
Section 9(5) for housekeeping, TCS Section 52 for other services, TDS 194-O on payouts, and mixed compliance.
5. Do Manpower & Facility Businesses Need GST Registration?
Yes — all businesses in this sector need GST registration once annual turnover exceeds ₹20 Lakh (₹10 Lakh for special category states), or if they make inter-state supplies. For e-commerce operators and home services platforms, registration is mandatory from Day 1 under Section 24.
Registration Requirements by Business Type
| Business Type | GST Registration |
|---|---|
| Security Agency | Required if turnover > ₹20 Lakh OR inter-state |
| Housekeeping Agency | Required if turnover > ₹20 Lakh OR inter-state |
| Manpower Agency | Required if turnover > ₹20 Lakh OR inter-state |
| Facility Management Company | Required if turnover > ₹20 Lakh OR inter-state |
| Pest Control Business | Required if turnover > ₹20 Lakh OR inter-state |
| Recruitment Agency | Required if turnover > ₹20 Lakh OR inter-state |
| Cleaning Services Business | Required if turnover > ₹20 Lakh OR inter-state |
| Home Services Platform (Marketplace) | Mandatory from Day 1 — no threshold (Section 24) |
Documents Required for Registration
Takeaway: Multi-state operations trigger mandatory registration from Day 1. Home services platforms cannot use the threshold — register before going live.
6. Can Manpower & Facility Businesses Claim Input Tax Credit (ITC)?
Yes — but with major restrictions. ITC is available on equipment, chemicals, software, rent, and RCM sub-contracts — but NOT on wages paid to deployed workers, which is the single largest cost for most businesses in this sector.
ITC Availability by Expense Type
Full ITC on machinery, tools, vehicles, and equipment used in service delivery.
Full ITC on cleaning chemicals, pesticides, uniforms, and consumables.
Full ITC on CMMS, ATS, CRM, HRMS, and cloud hosting.
Full ITC on office rent, electricity, internet, and maintenance.
Full ITC on reverse-charged sub-contracted services (manpower, security, housekeeping).
Full ITC on Google Ads, job boards, and promotional campaigns.
No ITC on salaries/wages paid to deployed workers — the biggest blocked item.
No ITC on statutory contributions to PF and ESI.
Takeaway: ITC is a partial relief — not a full offset. Wages are the biggest blocked cost in this sector. Budget for significant GST cash outflow.
7. When Does Reverse Charge (RCM) Apply in Manpower & Facility Services?
Reverse charge applies when a registered business sub-contracts manpower, security, or housekeeping services from unregistered individuals or small agencies. RCM does NOT apply to recruitment services.
RCM Applicability Matrix
| Service Sub-Contracted | RCM Applies? |
|---|---|
| Manpower Supply from Unregistered Vendor | Yes |
| Security Services from Unregistered Vendor | Yes |
| Housekeeping from Unregistered Vendor | Yes |
| Recruitment Fees to Freelance Recruiters | No (professional service) |
| Equipment Rental from Unregistered Vendor | No (not under notification 29/2019) |
| Foreign Recruiter Commissions | Yes (under general import RCM) |
RCM Process — 5 Steps
Takeaway: RCM is a pass-through — no net cash cost, but mandatory reporting. Missing it triggers interest and penalties under Section 201.
8. Section 9(5) for Home Services Platforms – The Special Case
Home services platforms face a dual GST model. Housekeeping services are notified under Section 9(5) — the platform is the deemed supplier. All other services (beauty, repair, plumbing, tutoring) follow the standard ECO model with TCS.
Section 9(5) vs TCS by Service Category
| Service Category | GST Model |
|---|---|
| Housekeeping Services | Section 9(5) — platform is deemed supplier |
| Beauty / Salon | Standard ECO — TCS Section 52 |
| Plumbing / Repair | Standard ECO — TCS Section 52 |
| Appliance Repair | Standard ECO — TCS Section 52 |
| Home Tutoring | Standard ECO — TCS Section 52 |
| Fitness / Yoga | Standard ECO — TCS Section 52 |
| Pet Grooming | Standard ECO — TCS Section 52 |
Key Implications for Platforms
- Two Invoice Flows: Platform issues invoice for housekeeping (9(5)); professional issues for everything else.
- Two GST Payments: Platform pays 18% GST on housekeeping; professionals pay for their own services.
- Mutual Exclusivity: Never apply both 9(5) and TCS to the same housekeeping service — that's double compliance.
- TDS 194-O Applies Regardless: 1% income tax TDS on all payouts to professionals, irrespective of 9(5) or TCS model.
• Housekeeping (9(5)): Platform invoices customer ₹1,180 (₹1,000 + ₹180 GST). No TCS.
• Beauty (standard ECO): Beautician invoices customer ₹1,180. Platform collects ₹10 TCS. Platform commission invoiced separately.
Takeaway: For home services platforms, the classification per service category drives everything. Get the 9(5) vs TCS distinction right, or face double compliance and audit risk.
9. What are the Key GST Deadlines for Manpower & Facility Businesses?
Missing a compliance deadline costs money, time, and reputation. Here are the critical dates every business in this sector must track:
| Compliance Activity | Deadline | Consequence of Missing |
|---|---|---|
| GSTR-1 (Monthly) | 11th of following month | Late fee and interest; breaks TDS/TCS reconciliation |
| GSTR-3B (Monthly) | 20th of following month | Late fee and interest; blocks ITC claims |
| GSTR-8 (TCS by Platforms) | 10th of following month | Blocks professional TCS credit; penalties |
| GSTR-9 (Annual) | 31 December of following FY | Penalty up to 0.50% of turnover |
| TDS 194C/194J Deposits | 7th of following month | Interest under Section 201 |
| TDS 194-O Deposits | 7th of following month | Interest under Section 201 |
| TDS Returns (26Q) | Quarterly | Penalty under Section 271H |
Takeaway: Build a compliance calendar with all deadlines and set automated reminders 5 days before each one — especially GSTR-8 and TDS deposits.
10. 10 Common GST Mistakes in Manpower & Facility Services (With Solutions)
Takeaway: The biggest GST risks in this sector come from wrong TDS section, missing RCM, 9(5) vs TCS misclassification, and claiming ITC on wages.