GST Applicablity on Contract Employee Canteen & Transport Deduction

[Bhushan Velhal]

Hi All,

We are manufacturer of Wiring Harness of Motor Vehicle. Chapter heading 85443000 Our total employee including contractual are 1000. Hence canteen facility to the workers is the statutory requirement under Section 46, of the Factories Act, 1956.

Caterer is third party who is preparing foods at his location and serves in our premises. Kindly confim on GST applicablity on Contract Employee Canteen Deduction.

Regard Bhushan

[Kusalava InternationalLimited]

Dear Mr. Bhushan,

Supply of food for a consideration is a 'Business' as defined under Section 2 (17) of CGST Act, 2017 and also the respective SGST Acts, 2017.

'Caterer' is a 'Supplier' of service as defined under Section 2 (105) ibid and you are a 'Recipient' of the service as defined under Section 2 (93) ibid. Supply of food is a 'sale' as defined under Section 7(1) of the Act.

The rate of tax on 'Supply of Food' is 18% with full Input Tax Credit (ITC) and is covered under Sl. No. 23 of 'Schedule of GST Rates for Services as approved by GST Council'.

N V T D Prasad

[Bhushan Velhal]

Dear Sir,

Thanks for replay.

pls. confirm GST applicablity on Employee canteen charges/deduction on Canteen Facility.

Regards

Bhushan

[Priyadharshini Elango]

Hi All,

We are working women and college students staying in a Charities Ladies Hostel, Total inmates in our hostel sums to 70. The Hostel President hired a Caterer who is a third party for the supply of Food and Food being prepared in our Hostel Kitchen and the food supplies are brought by the Employees of Caterer.

Kindly confirm on GST Applicability concerning this.

Regards ,

Priyadharshini.E

AI Summary

Supply of food services taxable at standard rate; employer-provided canteen by third-party attracts GST and input tax credit available Supply of food by a third-party caterer to an employer, employee canteen, or hostel is a taxable supply of services; the caterer is the supplier and the employer/hostel or inmates are the recipient, and such food supplies are subject to GST at the standard rate with entitlement to full input tax credit.