TaxTMI 
TaxTMI 
TaxTMI 
XYZ Pvt. Ltd. is owning motor cars and the same are used by the employees for their personal as well as for official use. Is XYZ required to pay GST on it towards service provided to employees?
Services supplied to employees
Kaustubh Karandikar
GST Not Applicable on Employee Car Perks as Compensation, per Circular No. 172/04/2022-GST and Advance Rulings. XYZ Pvt. Ltd. provides motor cars to employees for personal and official use. The question is whether GST applies to this service. Responses indicate that perquisites provided under an employment contract are not subject to GST, as they are considered part of the employee's compensation. References include Circular No. 172/04/2022-GST and relevant Advance Rulings. Additionally, if the company has paid GST on the car purchase without claiming credit, the provision of cars as part of the employee's compensation package should not be liable to GST. (AI Summary)