INSURANCE AGENT CROSING 20 LAKH

[RAHUL GAIKWAD]

My client have crossed the 20 Lakh limit of GST. He is Insurance Commision Agent. He is Regularly Filing GST Returns Since Jan-2019. His company Rejects his Reimbursement of GST. and Said that Insurance Commission attracts Reverse Charge. Whats is actual process.?

[KASTURI SETHI]

Yes. Services of insurance agent are under RCM. See notification No. 13/17-CT(Rate) dated 28.6.17 as amended. Serial No.7 of notification refers. Under RCM no threshold exemption is available.

[RAHUL GAIKWAD]

Then while Filing GSTR 3B- What information and in which colum we have to put.?

[KASTURI SETHI]

Serial No. (b) of Table No.3.1 is to be filled in. Gross receipt (amount of commission) is to be filled in under the head , "Total Taxable Value".

[RAHUL GAIKWAD]

Thanks a lot

[KASTURI SETHI]

SECTION 24. Compulsory registration in certain cases. - Notwithstanding anything contained in sub-section (1) of section 22, the following categories of persons shall be required to be registered under this Act, -

(vii) persons who make taxable supply of goods or services or both on behalf of other taxable persons whether as an agent or otherwise;

[KASTURI SETHI]

Just for Additional Information

'Intermediary Services' are covered under Section 24 (vii) of CGST Act, 2017. An agent, broker etc. plays the role of intermediary service. Hence compulsory registration without any threshold exemption.

AI Summary

Reverse charge for insurance agent services requires declaring gross commission in GSTR 3B and compulsory registration. Insurance agent commissions fall under the reverse charge mechanism with no threshold exemption; gross commission must be declared in GSTR 3B Table 3.1 serial (b) as 'Total Taxable Value.' Section 24(vii) requires compulsory registration for persons making taxable supplies on behalf of others, including agents and intermediaries, irrespective of turnover thresholds.