Why PG Popular | About | Pocket-Friendly | Renting Flat | Benefits of PG | Hostel | PG Facilities | Advantages | Disadvantages | Tax Liability | PG Agreement | Conclusion | FAQs

The concept of paying guests is not a new term today. The idea has been in existence for a substantial time now. PG accommodation mainly started with students or interns who had to leave their native place and seek education or job opportunities in other locations.

The PG accommodation became quite popular in a short time as it benefitted the individuals seeking a place for a short time while giving an earning opportunity to the house-owner who had extra space to share with others.

Also, read about Occupancy Certificate!

Paying Guest Accommodation
Source:  Anna Sullivan / Unsplash

Today PG is in demand as the volatility and uncertainty have reached a new peak. Individuals flock to far-off locations to search for better opportunities and tend to find temporary accommodation. As the standard rental requires a long-term commitment and demands high rent with a hefty deposit to be paid upfront, PG accommodation automatically becomes the best choice.

In addition, the PG accommodation provides the basic home infrastructure like a bed, satellite TV, refrigerator, laundry services, food etc. which the rental home cannot. The individual may have to invest in all this apart from paying for the upfront deposit and monthly rentals. It also proves convenient if the individual seeks some better opportunity in another city and can leave the PG accommodation by just wrapping his clothes and necessary accessories.

In this blog, we will cover all information about Paying Guest Accommodation on the following points to give us an idea about why it is one of the most preferred staying options today.

Hopefully, the information we provide will be valuable to the property owners looking for a paying guest and the paying guest too!

  • What is PG accommodation?
  • Is PG accommodation pocket-friendly?
  • The difference between PG accommodation and renting a flat?
  • Benefits of PG accommodation over a flat
  • How is PG better than Hostel?
  • PG accommodation facilities
  • Advantages of staying as a Paying Guest
  • Disadvantages of staying as a Paying Guest
  • Tax liability on the PG accommodation owner
  • PG agreement

What Is PG Accommodation?

Paying Guest accomodation
 Source: Yasmina H / Unsplash

Paying guest accommodation is an arrangement where an individual lives in a house with the owner and pays him the agreed monthly rent for staying and using the other facilities like housekeeping, water, electricity and food.

To offer a room for paying guests differs from renting a home. The owner and the paying guest both stay under the same roof. The owner of the flat or house just gives out his extra room to the paying guest to earn money.

Many times the owners may extend their property to accommodate more paying guests. PG accommodation is preferred near work sites or educational institutes to reduce travel time.

A PG accommodation can be single or shared and sometimes congested if the owner crams in more beds in one single room to earn more money. Not all PG accommodations provide food but arrange a kitchen for the guests if they are enthusiastic about preparing their food.

Let us find in the next section whether PG accommodation is affordable or not.

Is Paying Guest Accommodation Pocket-Friendly?

pocket friendly Paying Guest accododation
Source: Towfiqu barbhuiya / Unsplash

If you compare the costs of PG accommodation against the common rental properties, you will find PG much cheaper and more convenient. A rental property will demand you to set up all the basic things needed in a house, like a bed, wardrobe, cleaning, maintenance, hiring a maid, and paying the rent and utility bills.

If you sum up the expenses going into all this, you will find PG accommodation very affordable than the standard rental flat. In addition, when you want to leave for another city, you have nothing to take care of or dispose of while living as a paying guest. You just need to wrap up your clothes and leave.

Let’s find more differences between PG accommodation and renting a typical flat.

Paying Guest Accommodation Vs Renting A Flat

Paying Guest AccommodationRental Flat Accommodation
Shared accommodation.No sharing.
The owner of the PG accommodation may provide you with food. He will pay the utility bills and perform other responsibilities for the house. You just need to pay the rent.You need to cook the food and entirely manage the house like paying the bills in time, cleaning the flat etc. Apart from this, you still need to pay the rent.
Rent is on the lower side as compared to rental.Rent is as per the market value prevailing in that specific area.
Affordable and convenient.Costly and hectic to manage
A commitment of 2 months is enough.Requires a commitment of a minimum of 11 months.
Interact direct with the owner.Agents/middlemen are involved and charge you a 1 month’s rent as commission.
In PG, you stay with a company, which is good in an emergency.In a flat, you might stay alone and neighbours may not come to help you in emergencies.
You may get home-cooked food.Either you will need to prepare on your own, hire a maid or order from nearby restaurants.
You may tune up with the owner or other paying guests from the same premises and socialise.In an apartment, interaction is very less between the flat owners and tenants.
PG accommodation is mostly near the town, which means close to the business areas or educational institutes.The flat may not be near to the offices or educational institutes, increasing your travel time and draining your energy on the other side.

4. Benefits Of PG Accommodation Over A Flat

PG accommodation over flat system
Source:  Razvan Chisu / Unsplash

For students and working professionals from other cities, PG accommodation is the best option. It offers several benefits to make life simpler for these guys.

When you are away from home, you are on a tight budget. You need to save for food, travel and accommodation. It makes no sense to spend money on spacious accommodation, as most of the time you will only be using it after evening till morning, apparently just for relaxing and sleeping.

That’s where the PG accommodation comes to the rescue. It solves all your issues related to household chores and other responsibilities. You may opt for food and other facilities from the host, helping you to concentrate on your work or study, as applicable.

In a shared scenario, you won’t feel homesick, as there will be other paying guests staying on the same premises with whom you can build a rapport.

In the next section, we will emphasise how PG staying is better than staying in a hostel.

How is PG better than Hostel?

Let’s compare different points of PG and Hostel to understand why Paying Guest Accommodation is better than the Hostel.

PG AccommodationHostel
Meant for college students or working professionalsThe hostel is mainly for students or community living.
Equipped with good amenitiesMay lack even the basic amenities
More expensive than hostelsLess expensive but may be of lower standards
No dedicated security providedComes with dedicated security
It May have a few restrictionsHas a lot of restrictions on entering the hostel or leaving the hostel, inviting guests or friends isn’t allowed.
Offers better privacyLess privacy
Good maintenance and cleanliness are maintained for a few exceptionsIt May not be maintained up to the mark and may not focus on cleanliness

Paying Guest Accommodation Facilities

1. Food

Those who don’t have a high choice of food can cope with the PG accommodation food. You will have to follow the meal times to co-operate with the owner, with an understanding that they are not running a restaurant.

Some owners may provide a kitchenette with a gas connection, stove, and utensils to help prepare your food. If you are ready to spend more, you may also get to use the refrigerator.

2. Facilities

A typical PG accommodation is well-furnished with a clean washroom and bathroom. Ideally, the owner should provide you bed, geyser and wardrobe etc. An above-average pg accommodation may give you access to a common room having TV and music systems. Vehicle parking may also be available at some PG accommodations.

Nowadays, washing machines and iron may also be available for paying guests. If the owner has any housekeeping staff, they may charge you for doing your laundry work, helping you to focus on your studies or work, whatever.

Recently, the owners shared WiFi passwords with the PG.

Advantages Of Staying As A Paying Guest

  • It’s affordable to stay in PG. There may be various options for you to choose either single, double or triple sharing rooms.
  • You may not feel lonely when you stay in a PG accommodation and may get a chance to socialise with other PG members. The chances of getting homesick are less in a PG accommodation.
  • You can opt to get the meals and laundry work done by the owner and concentrate on your studies or work.

Disadvantages Of Staying As A Paying Guest

  • You may not be getting the required privacy, as the owner and other PG members stay with you.
  • You might get bored with the fixed menu and the meal timetable.
  • You don’t have the right to complain against any odds, as the owner will have the final say.
  • You need to pay the rent in advance.

Tax Liability On The PG Accommodation Owner

No tax is applicable when a single owner offers the extra room from his house to the paying guest.

GST will only be applicable if the income exceeds Rs. 1,000/- per day.

Taxes in the form of GST are applicable for corporates renting rooms to multiple guests. The threshold limit if crossed the amount of Rs. 10 lacs per annum, the provider has to pay the service taxes.

PG Agreement

Paying Guest accommodation agreement
Source: Scott Graham / Unsplash

PG accommodation is trending in cities, which may lead to charging them high deposits and rents in exchange for low-quality facilities. To combat such situations, document an agreement with clear terms and conditions mentioned in the agreement.

It will also be good for the owner, as the document mentions the PG’s responsibilities and behaviour.


Today, PG accommodation is one of the most affordable temporary or short-term renting solutions. It benefits both the owner and the paying guest. It serves as an income stream for the landlord while supporting the individuals who have come to the city with some purpose.


What facilities can I expect from the landlord as a PG?

Ideally, the landlord should provide you with meals, a wardrobe, WiFi, a bed, a table and a chair. At some PG accommodations, the owner may also provide extra facilities like Laundry, TV, Refrigerator etc.

For how many days can I stay as a P.G.?

You can stay for a minimum of 1 or 2 months and a max of 11 months. Legally the licence for PG is considered every month.

Is cooking allowed for PGs in PG accommodation?

You can check it before finalising a property. Not all PG accommodations provide a kitchen, so it’s better to check before deciding.