GST on certain Reimbursement to Employee and Schedule I transactions

[V Rajalakshmi]

The employer is recovering a certain amount from the employee for the following reasons

1. Telephone Exps

2. Notice Pay

3. Canteen Exps

4. Group Medi claim Exps.

Please note that in all the above cases the amount incurred by the employer is not added to the salary income of employees.

Some people are considering it as schedule 1 transactions and paying GST and Some of them are of the view that it will not fall under schedule 1 supply kindly update your views with the latest decided case law if any.

AI Summary

Debate on GST Liability for Employer Cost Recoveries: Notice Pay, Telephone, Canteen, and Medical Claims. An employer is recovering costs from employees for telephone expenses, notice pay, canteen expenses, and group medical claims, without adding these to the employees' salary income. There is a debate on whether these should be considered Schedule I transactions under GST, which would require GST payment. One opinion suggests that notice pay is not liable for GST, supported by a high court decision, while others argue these are reimbursements and not actual supplies. Another perspective is that tolerating an employee not serving a notice period could be taxable. The suggestion is to include these in the cost to company (CTC).