TaxTMI 
TaxTMI 
Company received interest from customer on delay payment of consideration for sale of goods made under Bihar VAT for goods taxable @5%. Now GST officer is demanding GST @18% on this interest. Whether GST is levy on such interest received on account of supply made pre-GST period.
Interest Received in GST Period for supply made in Pre GST Period
06 Mar 2026 
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GST on interest may arise when interest received for delayed payment and be taxable under time of supply rules.
Interest received for delayed payment on a pre GST supply can be part of the taxable value under GST; statutory provisions treat interest on late payment as included in value and specify that additions to value by way of interest are treated as supplied on the date the supplier receives the interest, so GST liability arises in the period of receipt. (AI Summary)
Interest received for delayed payment on a pre GST supply can be part of the taxable value under GST; statutory provisions treat interest on late payment as included in value and specify that additions to value by way of interest are treated as supplied on the date the supplier receives the interest, so GST liability arises in the period of receipt. (AI Summary)