GST on ESOP reimbursements: cost-to-cost reimbursements not taxable, additional facilitation fees taxable under reverse charge. Securities (including shares) issued as ESOP/ESPP/RSU to employees form part of remuneration and, being neither goods nor services, are not subject to GST; reimbursement by the domestic subsidiary to the foreign holding company on a strict cost-to-cost basis for such shares does not amount to import of services and is not taxable. Any additional amount charged by the foreign holding company over and above the cost-labelled fee, markup, or commission-constitutes consideration for facilitation services and is taxable, with GST payable by the domestic subsidiary on reverse charge.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
GST on ESOP reimbursements: cost-to-cost reimbursements not taxable, additional facilitation fees taxable under reverse charge.
Securities (including shares) issued as ESOP/ESPP/RSU to employees form part of remuneration and, being neither goods nor services, are not subject to GST; reimbursement by the domestic subsidiary to the foreign holding company on a strict cost-to-cost basis for such shares does not amount to import of services and is not taxable. Any additional amount charged by the foreign holding company over and above the cost-labelled fee, markup, or commission-constitutes consideration for facilitation services and is taxable, with GST payable by the domestic subsidiary on reverse charge.
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