Amount paid on behalf of related party

[Kaustubh Karandikar]

XYZ is making payment to various parties on behalf of the persons / entities which are related to XYZ. The amount so paid is debited to the respective person / entities account. This being paid on behalf of related parties; will it amount to rendering service to related parties and XYZ will be liable to pay GST on it even if no consideration is received from related parties?

AI Summary

Debate Over XYZ's Role: Intermediary Liable for GST or Lender with GST-Exempt Interest? XYZ is paying on behalf of related parties, raising the question of whether this constitutes a service subject to GST, despite no consideration being received. One participant argues that this activity is part of business operations and classifies XYZ as an 'intermediary', liable for GST. Another suggests viewing the payments as loans, with interest as consideration, which is GST-exempt. The debate centers on whether XYZ's role fits the definition of an intermediary, as XYZ is not facilitating supply but making payments post-supply, thus acting more as a lender than an intermediary.