TaxTMI 
TaxTMI 
Dear Experts
What is your view on RCM payment on personnel guarantee provided by the Directors of the Company for taking Loan, I have seen Showcase on one whats app group on this service.
GST on Personel Gurantee provided by Directors to company for taking Loans
24 Sep 2023 
7 Replies 
2202 Views Asked by
Reverse charge on director-provided personal guarantees: recipient companies may owe GST under deemed supply rules, pending clarification.
Receipt of personal guarantees from directors is being treated as a deemed supply between related persons subject to reverse charge; valuation is determined by open market value principles and government guarantee fee guidance, obliging the recipient company to declare the deemed guarantee fee in returns and discharge GST under reverse charge, with failure to declare or pay treated as suppression attracting demand, interest, and penalty. (AI Summary)
Receipt of personal guarantees from directors is being treated as a deemed supply between related persons subject to reverse charge; valuation is determined by open market value principles and government guarantee fee guidance, obliging the recipient company to declare the deemed guarantee fee in returns and discharge GST under reverse charge, with failure to declare or pay treated as suppression attracting demand, interest, and penalty. (AI Summary)