Taxontips
No Result
View All Result
Thursday, February 2, 2023
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Talk to an Expert
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
No Result
View All Result
Taxontips
No Result
View All Result

No GST under RCM on salary to executive directors – Karnataka AAR

GST expert by GST expert
May 9, 2020
in Case Laws, GST news
1
Salary/ remuneration paid to directors also liable for GST under Reverse charge – Advance ruling Rajasthan
140
SHARES
1.7k
VIEWS
image_pdfPDFimage_printPrint

In a recent Rajasthan AAR it was stated that any kind of consideration paid to directors would be considered as director remuneration and would be charged to GST under RCM. Many people were worried after that AAR as no difference was shown in treatment between executive and non executive director.

In the current AAR by Karnataka state Dt. 04.05.2020 there were various issues which were dealt with which are as follows:

a) Partner’s salary as partner from my partnership firm,
b) Salary as director from Private Limited company
c) Interest income on partners fixed capital credited to partner’s capital account
d) Interest income on partners variable capital credited to partner’s capital account
e) Interest received on loan given,
f) Interest received on advance given
g) Interest accumulated along with deposit/ fixed deposit
h) Interest income received on deposit/ fixed deposit
i) Interest received on Debentures
j) Interest accumulated on debentures
k) Interest on Post office deposits
l) Interest income on National Savings certificate (NSCs)
m) Interest income credited on PF account
n) Accumulated Interest (along with principal) received on closure of PF account.
o) Interest income on PPF
p) Interest income on National Pension Scheme (NPS)
q) Receipt of maturity proceeds of life insurance policies
r) Dividend on shares
s) Rent on Commercial Property
t) Residential Rent
u) Capital gain /loss on sale of shares

In the present AAR, assessee was of the belief that the Income received towards any kind of salary is outside the purview of GST and not be included in the aggregate turnover of individual for GST purpose.

In this regard, AAR stated that there could be two possibilities i.e. first applicant could be employee of the said company i.e. executive director or he could be a non executive director of the company and provide his services to the company.

In the first case service of applicant as employee to the employer are neither treated as supply of goods nor supply of services as same would fall under Schedule III of CGST Act. In the second case remuneration paid by company would be liable to reverse charge under GST by virtue of Notification no. 13/2017 Central Tax (Rate), Dt. 28.06.2017.

To read the full order CLICK HERE.

Thus, this is a more balanced view and most people would relate to this view as compared to the view taken by Rajasthan AAR as there the concept of executive and non executive director was not even considered and it was treating all directors in similar fashion.

Even though this judgement’s are not final and as we know AAR is only applicable to the case of assessee who has sought, however it gives us a sense about the thought process of department as one state GST department thinks all directors are equal and one thinks in a opposite way. Many a times we even see two High courts giving different decision on similar issue and therefore one should follow the High court of their state or if there is a more favorable judgement to assessee one can follow that.

 

This article is just for information purpose and are personal views of the author. It is always advisable to hire a professional for practical execution. If you need assistance you can ask a question to our expert and get the answer within an hour or post a comment about your views on the post and also subscribe to our newsletter for latest weekly updates.

image_pdfPDFimage_printPrint
Tags: AARlatest case lawlatest judgement
Previous Post

GSTR 3B can now be recitified - Landmark Judgement by Delhi High court

Next Post

What is the meaning of notice for transfer of rectification rights to Assessing officer

Related Posts

GST registration
GST news

2nd highest Gross GST collection in January 2023, breaching earlier 2nd highest record in the Month of October 2022

February 1, 2023
Further clarification by CBIC for claiming 20% ITC on invoices not available in GSTR – 2A. Circular 123/42/2019 – GST
GST news

Clarification on entitlement of ITC where place of supply is determined in terms of proviso to sub-section (8) of section 12 of the IGST Act

January 27, 2023
GST Registration cancelled if GSTR 3B not filed for past 6 months or more. Want to know why?
GST news

Advisory on facility of ‘Initiating Drop Proceedings’ of Suspended GSTINs due to Non-filing of Returns – Update

January 24, 2023
Further clarification by CBIC for claiming 20% ITC on invoices not available in GSTR – 2A. Circular 123/42/2019 – GST
GST news

Clarification regarding the treatment of statutory dues under GST law [Read circular]

January 21, 2023 - Updated on January 27, 2023
Annual return optional for F.Y. 2017-18 and 2018-19 for Turnover below Rs. 2 crore
GST Returns

Clarifications regarding applicability of GST on certain services based on 48th GST council meeting

January 20, 2023
Data of GST website under comparison of liability declared and ITC claimed tab not available
GST news

Module wise new functionalities deployed on the GST Portal for taxpayers – December 2022

January 17, 2023
Next Post
What is the meaning of notice for transfer of rectification rights to Assessing officer

What is the meaning of notice for transfer of rectification rights to Assessing officer

Comments 1

  1. Pingback: Interest on savings bank, PPF and personal loan will be a part of aggregate turnover under GST and considered for limit of registration - Gujarat AAR - Taxontips

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Google Custom search

Recent Posts

  • [Live] Updates and Tax changes for Budget 2023 | Tax on cryptocurrency | Income tax and GST udpates in Budget 2023 [Download Bill]
  • 2nd highest Gross GST collection in January 2023, breaching earlier 2nd highest record in the Month of October 2022
  • CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023
  • Final stage of Union Budget 2023-24 commences with Halwa Ceremony
  • Clarification on entitlement of ITC where place of supply is determined in terms of proviso to sub-section (8) of section 12 of the IGST Act

Recent Comments

  • CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023 - Taxontips on Instructions issued by CBDT in response to judgement passed by Hon’ble Supreme court in case of notice issued u/s 148 after 01.04.2021
  • CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023 - Taxontips on Supreme court Judgement on controversial issue of notice u/s 148 issued after 01.04.2021 passed in favor of Revenue | Detailed analysis of full judgement
  • Final stage of Union Budget 2023-24 commences with Halwa Ceremony - Taxontips on What is ‘Halwa ceremony’, performed before the budget at Ministry of Finance? What does it signify? | Pre budget facts
  • Leonard Linton on Clarification for the purposes of Section 269ST of the I.T. Act in respect of dealership/distributorship contract in case of Co-operative Societies
  • Advisory on facility of ‘Initiating Drop Proceedings’ of Suspended GSTINs due to Non-filing of Returns - Update - Taxontips on Advisory on “Initiating Drop Proceeding” by taxpayers for non-filing of GST returns

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Browse Topics by Date

February 2023
M T W T F S S
 12345
6789101112
13141516171819
20212223242526
2728  
« Jan    
  • GSTR 9/ 9C due date to be extended to 31.10.2020 | E-invoicing will be voluntary in the beginning 79.3k views
  • How to pay Membership and COP fees of ICAI for 2020-21 | 77.8k views
  • Code/ Nature of payment 6CR updated by NSDL in challan 281 for paying TCS on sale of goods 68.1k views

Recent Notification

[Live] Updates and Tax changes for Budget 2023 | Tax on cryptocurrency | Income tax and GST udpates in Budget 2023 [Download Bill]

[Live] Updates and Tax changes for Budget 2023 | Tax on cryptocurrency | Income tax and GST udpates in Budget 2023 [Download Bill]

February 1, 2023
GST registration

2nd highest Gross GST collection in January 2023, breaching earlier 2nd highest record in the Month of October 2022

February 1, 2023

RSS Taxontips

  • [Live] Updates and Tax changes for Budget 2023 | Tax on cryptocurrency | Income tax and GST udpates in Budget 2023 [Download Bill]
  • 2nd highest Gross GST collection in January 2023, breaching earlier 2nd highest record in the Month of October 2022
  • CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023
  • Final stage of Union Budget 2023-24 commences with Halwa Ceremony
  • Clarification on entitlement of ITC where place of supply is determined in terms of proviso to sub-section (8) of section 12 of the IGST Act
  • Consequences of Accepting cash while selling a Immovable property, land or house | 100% Penalty
  • How many articles can a Chartered Accountant register for articleship?
  • Advisory on facility of ‘Initiating Drop Proceedings’ of Suspended GSTINs due to Non-filing of Returns – Update
  • ICAI has launched free task management or practice management software for members in Practice
  • Clarification regarding the treatment of statutory dues under GST law [Read circular]

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Site menu

  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Taxontips

TaxOnTips provides you all tax related solutions in easy way and update you with its regular updates & notifications Visit us for details.
We are based in Jaipur, India

© 2019-2021 Taxontips.com - Tax assistance at your Fingertips

No Result
View All Result
  • Login/Signup
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
  • Ask an expert/ Talk to an expert
  • Privacy Policy
  • Terms of use

© 2019-2021 Taxontips.com - Tax assistance at your Fingertips

Login to your account below

Forgotten Password? Sign Up

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
Book Phone consultation with expert

Sitting home or at your office and don't have time to visit CA's office or don't know where to consult CA. Book your consultation with an expert practicing Chartered Accountant and get your query solved.

Book a phone consultation for 30 minutes with our expert at a very basic cost.

Book consultation

No thanks, I'm not interested!

ITR 1 to 7 now available for FY 2021-22!!File your ITR with an experienced Chartered Accountant

Now File your Income Tax return for F.Y. 2021-22 with an Experienced Practicing Chartered Accountant and not just with any person like other websites offer. Return filing starts at Rs. 500/-

Book ITR filing with Expert

Never see this message again.

Subscribe for Latest Tax Updates
You name
Yourname@email.com

Never see this message again.