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

GST on reimbursements: employer recoveries for employee expenses generally treated as reimbursements, not taxable supplies.
Recoveries by an employer from employees for telephone, canteen, group medical and notice pay are to be analysed as either reimbursements for an underlying supply or as transactions arising from the employer-employee contract; recoveries that are true reimbursements to third-party suppliers do not constitute a separate taxable supply, and notice pay recoveries are generally viewed as outside GST though an alternative view treats toleration of an act as taxable.