Query on RCM for the affiliation fee payable to foregin educational institutions

[Ravi Venkatraman]

Dear Experts,

I work for an educational group, based out of Bangalore, which has in its group, 1 International School also, for which affiliation fees are to be paid to Cambridge UK and also one more educational affiliation organisation in Singapore. We have heard that on such affiliation fees paid to those foreign institutes, we are to remit GST to government, under RCM. since the educational services are exempt from GST, we have not registered under GST, is the information that we have to remit RCM on affiliation fees is correct and if so, do we need to register under GST act, only to remit the RCM and keep filing NIL returns, during the rest of the months, when no such affiliation fees are being paid. how shall we proceed.

Request your opinion.

thanks !

AI Summary

Foreign Affiliation Fees by Educational Groups Attract GST Under Reverse Charge Mechanism Despite Domestic Exemptions An educational group pays affiliation fees to foreign institutions and questions whether GST is payable under reverse charge mechanism (RCM) despite educational services being exempt from GST. Experts clarify that fees paid for services from outside India are subject to RCM, requiring GST registration even if only to remit tax and file nil returns otherwise. The exemption for educational services does not explicitly cover foreign affiliation fees, creating interpretative uncertainty. It is suggested to seek government clarification to align foreign affiliations with domestic exemptions. To comply and avoid disputes, registration and payment under protest with refund claims is advised, though some may opt to pay without contest due to potential litigation costs.