TAX LIABILITY ON BENEFITS OR PERQUISITES RECEIVED FROM SUPPLIER

[BARUN MUKHERJEE]

SIR,

IS THERE ANY LIABILITY TO PAY GST ON BENEFITS OR PERQUISITES RECEIVED IN RESPECT OF BUSINESS OR PROFESSION?

[Charu Tyagi]

Yes, in case of benefits and perquisites received from supplier GST shall be applicable

Valuation of such perquisites shall be done as per Rule 27 of CGST Rules, 2017 where the consideration is not wholly in money.

[Amit Agrawal]

What do you mean by "BENEFITS OR PERQUISITES RECEIVED IN RESPECT OF BUSINESS OR PROFESSION"? Kindly give fact & context specific query (instead of generalised query) to get better answers.

[KASTURI SETHI]

Dear Querist,

Are you talking of performance based incentives or discounts or bonus ?

Pl. elaborate your query. The query is too short to give a fool proof reply.

[Padmanathan KV]

The expression "benefit or perquisite arising from business or exercise or profession" is in the context of Income Tax Act, section 28(iv) which is the charging section. Consequent TDS deduction is also provided under section 194R.

Therefore, I am presuming this query is with regard to income received on which TDS has been deducted under 194R and reflecting under 26AS.

However for attracting GST, one need to examine whether such perquisites or benefits received are in consideration for any supply of goods or services or both.

For that, as mentioned by Learned Amit Ji and Kasturi Ji, the entire facts including any contractual obligations between the parties has also to be examined.

[Padmanathan KV]

All income/ entries in Form 26AS need not be taxable under GST. Has to be verified based on facts

[KASTURI SETHI]

The query was posted on 20.9.23 and today is 24.9.23. The querist has not elaborated his query as desired by the experts.

AI Summary

GST on benefits or perquisites applies when they constitute consideration for a supply; valuation follows CGST valuation rules. GST applies to benefits or perquisites only if they amount to consideration for a supply of goods or services; valuation of such non-monetary consideration follows the valuation provisions in the CGST rules. Determination requires factual and contractual analysis, and entries in tax information statements do not automatically establish GST liability.