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

Insurance agent must register under Section 24(vii) CGST Act; no GST exemption for commission under RCM rules. An insurance commission agent has exceeded the 20 lakh threshold for Goods and Services Tax (GST) and is facing issues with reimbursement from his company, which claims that insurance commission is subject to Reverse Charge Mechanism (RCM). It was clarified that services of insurance agents fall under RCM as per notification No. 13/17-CT(Rate), and no threshold exemption applies. The agent must fill in the gross receipt under 'Total Taxable Value' in Table No. 3.1 of GSTR 3B. Additionally, compulsory registration is required for intermediaries under Section 24(vii) of the CGST Act, 2017.