Interest recovered from employees on loan given

[Kaustubh Karandikar]

XYZ Pvt. Ltd. Is recovering Interest from employees towards personal loan given to them. Is XYZ required to pay GST on the interest received?

AI Summary

Interest on Employee Loans Exempt from GST, Only Penal and Credit Card Interest Taxable per Notification No. 12/2017-CT (Rate) XYZ Pvt. Ltd. inquired about the applicability of GST on interest recovered from employees on personal loans. According to the experts, interest on loans or advances, excluding credit card services, is exempt from GST as per Notification No. 12/2017-CT (Rate). Only penal interest and credit card interest are taxable under GST. The discussion highlighted that GST applies to interest on delayed credit card payments, regardless of whether it is penal or routine. Participants acknowledged each other's expertise and expressed a commitment to learning and sharing knowledge in the field.