Reimburshment to employee on tour expense

[Narendra Soni]

Our marketing employee go on tour for business purpose, they claim reimburshment of fare/hotel bill /conveyance etc.

1.Whether GST is payable by company on bills under reverse charges issued by un registerded service providers..

2.Some bills have charged GST, is the ITC eligible to company.

[Arindam Mukherjee]

If the company received tax invoice from registered dealer then no RCM will arrise. but in case if the supply received from unregistered dealer and if the aggregate amount exceeds ₹ 5000/- per day the RCM will attract as per Sec9(4) of the CGST ACT.

Thanks &Regds

Arindam Mukherjee

[DR.MARIAPPAN GOVINDARAJAN]

I endorse the views of Sri Arindam

[KASTURI SETHI]

Bill should be in the name of employee, designation C/o. Name of Company address. ITC is admissible if it is in course or furtherance of business.

[Himansu Sekhar]

When bills issued to in registered persons in the name of individual employee who are in registered, there will be no gst.

[Guest]

your employees shall quote your company GSTIN number and bill in the name of the company. After then you will eligible fore credit

[THYAGARAJAN KALYANASUNDARAM]

Dear sir,

Query no. 2,

Regarding input tax credit with respect to hotel bills as follows.

As per sec 12(3) of IGST Act, by way of lodging accommodation by a hotel, Inn, guest house, honestly, club or campsite, by whatever name called and including a house boat or any other vessel the place of supply of services shall be the location at which the immovable property or boat or vessel is located or intended to be located.

If your employee going to other states and stay, then the hotelier will charge sgst and cgst on the lodging bills and the input on these bills are ineligible.

[Kishan Barai]

It is advisable to make bill under Company name with it's & seller GSTN number mentioned to get ITC smoothly

[KASTURI SETHI]

Bill directly in the name of company is not possible. An employee who stays at Hotel will have to mention his name & designation first. Thereafter C/O. This way Company comes into picture for the purpose of hassle free ITC. After all the employee stays in the hotel for and on behalf of Company.

[Kishan Barai]

Absolutely Correct View By you Sir ....

[Ganeshan Kalyani]

Sri Kasturi Sir's view is to the point. Thanks.

If an employee of office in Maharashtra goes to Delhi and stay there in hotel and if the company is having branch in Delhi then it is requested to get bill in the address of Delhi office and GSTIN of the Delhi office should be mentioned so that Delhi office can take the credit.

Further in my view hotel stay is eligible to take credit but not the food bills.

AI Summary

Reverse charge on supplies from unregistered vendors may make the recipient liable to pay tax and affect ITC entitlement. Reimbursement for employee travel expenses has GST consequences: supplies from registered suppliers do not attract reverse charge, while supplies from unregistered suppliers attract reverse charge if aggregate value exceeds the prescribed daily threshold. Entitlement to input tax credit depends on correct invoicing-bills in the company's name or employee name with c/o company and GSTIN facilitate ITC. Lodging services are subject to place-of-supply rules for immovable property, affecting whether central and local tax components are charged and whether ITC is claimable; practical advice is to obtain invoices bearing the appropriate company or branch GSTIN.