Value for charging GST

[Kaustubh Karandikar]

XYZ (Client from Delhi) had entered in to a Contract with PQR (a chartered accountant from Mumbai) to carry out audit of their records. As per the contract, the amount payable by XYZ to PQR towards professional fees will be ₹ 100000/- + the amount to be paid towards hotel stay, air fare etc. which will be directly paid by XYZ to hotel and the airlines. PQR is required to pay GST on ₹ 100000/- only or ₹ 100000/- + amount paid by XYZ towards hotel stay, air fare etc. directly to the hotel and the airlines?

AI Summary

GST Applies to Total Audit Fee Plus Reimbursed Expenses Under Section 15 of CGST Act 2017 A client from Delhi, XYZ, contracted a chartered accountant from Mumbai, PQR, for an audit, agreeing to pay 100,000 plus direct payments for hotel and airfare. The discussion revolves around whether GST should be applied only to the 100,000 or also include the reimbursed expenses. According to Section 15 of the CGST Act, 2017, GST should be charged on the total amount, including reimbursed expenses, unless XYZ agreed to cover these costs separately as part of the arrangement. The consensus among respondents is that GST applies to the total value, including additional expenses.