Tax for cleaning and housekeeping businesses in India

Cleaning and housekeeping is a business, so use presumptive Section 44AD (6% digital, 8% other), not 44ADA. GST is 18% on cleaning and housekeeping services with input credit on forward charge, registration applies at Rs 20 lakh of service turnover, and business clients deduct 194C TDS on contracts.

Presumptive + GST + TDS at a glance

Presumptive taxation

Section:: Sec 44AD
Deemed profit rate:: 6% on digital receipts / 8% on other receipts
Classification:: business

GST treatment

Slab:: 18%
SAC:: 9985 (cleaning/housekeeping/manpower services)
Composition eligible:: Yes
Reverse charge (RCM):: Not applicable

TDS exposure

Last reviewed: 29 May 2026

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Cleaning and housekeeping in India is a business, so presumptive taxation under Section 44AD is the simplest fit, not Section 44ADA. GST is 18% on cleaning and housekeeping services with input credit, registration applies at Rs 20 lakh of service turnover, and business clients such as offices and housing societies usually deduct TDS under Section 194C on a cleaning contract.

What business structure do cleaning and housekeeping businesses use?

The common patterns for cleaning and housekeeping businesses are: Sole proprietor, simplest, suits a solo or small-crew cleaner on 44AD, Partnership or LLP, for a housekeeping firm sharing staff and capital, Private limited, for a facilities-management contractor at scale. The right structure depends on revenue, liability exposure, and personal circumstances, covered below.

Income tax: Section 44AD

A cleaning or housekeeping business is a business, so presumptive taxation is under Section 44AD: a deemed 8% of turnover, or 6% on digital receipts, with no detailed books or audit within the limits, up to Rs 2 crore (Rs 3 crore where cash is 5% or less). Section 44ADA does not apply.

A cleaning business declares deemed profit of 6 or 8% of turnover under Section 44AD. (Income-tax Act 1961 s.44AD (Income-tax Act 2025 s.58))

GST: 18% on cleaning, and the manpower-supply point

Cleaning and housekeeping services are taxed at 18% GST with input credit, classified under SAC 9985, with registration once service turnover crosses Rs 20 lakh. Watch the manpower-supply angle: if you simply supply labour to a client who directs the work, that can be manpower supply (also 18%) rather than a cleaning contract, and the distinction affects how the value and any input credit are treated. Unlike security services, ordinary cleaning is on forward charge, you charge and pay the GST, it is not on reverse charge.

Cleaning and housekeeping (and manpower supply) are GST 18% on forward charge; register at Rs 20 lakh turnover. (CGST Act 2017 ss.22-24; SAC 9985)

194C TDS on cleaning contracts

When an office, company or housing society pays you under a cleaning or housekeeping contract, it deducts TDS under Section 194C at 1% (individual or HUF) or 2% (others), above Rs 30,000 single or Rs 1,00,000 aggregate in the year. Quote your PAN to keep the rate at 1 or 2%, and reconcile the credit in Form 26AS and AIS against your return.

A business paying a cleaning contractor deducts 1 or 2% TDS under Section 194C above the thresholds. (Income-tax Act 1961 s.194C (Income-tax Act 2025 s.393))

Allowable expenses

Category	Examples	Tax treatment
Equipment and supplies	Vacuum cleaners, scrubbers, mops, chemicals, consumables	Deductible; input credit if registered; in deemed profit under 44AD
Staff wages	Cleaners and housekeeping crew	Deductible if keeping books; pay over Rs 10,000/day by bank (40A(3))
Transport	Vehicle or fares to move crew and equipment, fuel	Deductible if keeping books; in deemed profit under 44AD
Uniforms and safety	Uniforms, gloves, masks, safety gear	Deductible business expense
Licences and admin	Trade licence, GST filing, accountant, phone	Deductible (apportion personal phone use)

Vehicle and travel costs

A vehicle used to move crew and equipment is a business asset: under regular books claim depreciation plus running costs; under presumptive Section 44AD that is treated as included in the deemed profit.

Capital allowances and equipment

On regular books, cleaning machines and a crew vehicle depreciate in the plant-and-machinery / motor-vehicle block (generally 15% WDV). Under Section 44AD no separate depreciation is claimed, but keep invoices for the written-down value on any later sale.

Worked example

Kavita — Noida, UP

housekeeping contractor (offices and housing societies) (2026-27)

Annual receipts Rs 32 lakh, mostly by bank transfer. Several office contracts deducted 194C TDS at 2% (paid to her firm). She employs a cleaning crew.

For income tax, deemed profit under 44AD is 6% of Rs 32 lakh = Rs 1,92,000, below the Rs 4 lakh new-regime exemption, so income tax is nil; she files and reclaims the 194C TDS. For GST she is registered (crossed Rs 20 lakh) and charges 18% on cleaning contracts with input credit on machines and chemicals. She pays crew wages by bank transfer to keep them deductible under Section 40A(3), and keeps clear whether each contract is a cleaning service or manpower supply.

Common audit triggers for cleaning and housekeeping businesses

Cash receipts over 5% of turnover while using the Rs 3 crore 44AD limit
Staff wages in cash over Rs 10,000 per person per day (Section 40A(3))
Cleaning contract treated as manpower supply (or vice versa) inconsistently in GST
Cash receipt of Rs 2 lakh or more from one client in a day (Section 269ST)
194C TDS in 26AS or AIS not reconciled with income reported
No GST registration after crossing Rs 20 lakh service turnover

Frequently asked questions

Is cleaning a business or a profession for tax?+

A business. Cleaning and housekeeping is a service business, not a notified profession, so the presumptive scheme is Section 44AD (deemed 6 or 8% of turnover), not the 50% under 44ADA.

Is my cleaning service on reverse charge GST?+

No. Unlike security services, ordinary cleaning and housekeeping is on forward charge, you charge 18% GST and pay it yourself. Watch the manpower-supply distinction though: if you supply labour that the client directs, it may be manpower supply rather than a cleaning contract, which can change how the value and credit are handled.

Why do my office clients deduct TDS?+

Businesses paying a cleaning or housekeeping contractor deduct TDS under Section 194C, 1% for an individual or HUF, 2% otherwise, above Rs 30,000 single or Rs 1,00,000 aggregate. It is withheld against your PAN and shown in Form 26AS and AIS; you reclaim it against your final tax, often as a refund if your presumptive income is low.

How do I pay my cleaning crew without losing the deduction?+

Pay by bank transfer or UPI. A cash payment over Rs 10,000 to one person in a single day is disallowed as a business expense under Section 40A(3), so cash wages above that cannot be claimed. Paying digitally keeps the wages deductible and your records clean.

Last reviewed: 29 May 2026