GST leviability on reimbursement expenses

[phaniraju konidena]

Dear Experts,

We have reimbursed the PF and E.S.I expenses of our production contractor's workforce as per the agreement in between us. Kindly advise whether there is any GST liability on us?. We have not received any services/goods from the contractor for such amount.

regards,

phani

AI Summary

GST on Reimbursed PF and ESI: Reverse Charge for Non-Corporate Contractors, Forward Charge for Manpower Supply. A query was raised regarding the GST liability on reimbursed PF and ESI expenses for a production contractor's workforce. One expert explained that GST is applicable under the reverse charge mechanism (RCM) if the contractor is not a corporate body, otherwise, the contractor is liable. Another response clarified that GST, including PF and ESI, is paid by the contractor for manpower supplies, with the inquirer only reimbursing statutory expenses. A third expert noted that manpower supply is under the forward charge mechanism (FCM), with GST payable by the service provider, citing relevant legal provisions.