The company pays you money for working during the notice period. So according to advance ruling, the company will have to pay GST on this amount.
If the company pays you money for working during the days of the notice period, then according to the Authority for Advance Ruling, the company will have to pay GST on this amount.
The Authority for Advance Ruling of the Income Tax Department has said that on payment of work done by the employees during the notice period, additional premium will be charged from the employees for group insurance policy and mobile phone bills of the employees. Now the employer will have to pay GST (Goods and Services Tax) on payment of Rs.
GST on notice period
Actually if you have resigned where you are working and there. Working in the company under notice period. If the company pays you money for working during the notice period, then according to the Authority for Advance Ruling, the company will have to pay GST on this amount.
GST burden on policy and other bills also
Apart from this, if the company has taken a group insurance policy and charges a part of its premium from its employee, then the company will also have to pay GST on that additional premium amount, as well as if the company pays the mobile bill. GST will have to be paid on that too, whereas on mobile bill already GST has to be paid.
Companies will put the burden on the employees
Although, according to the order of the Authority for Advance Ruling, companies will have to pay GST on these services, but it is obvious that companies mostly put the burden of such services on the employees. That is, due to this order of the Authority for Advance Ruling, there is going to be an additional burden on the pockets of the employees.
What is the complete order?
According to the order, in case of notice payment, the company is actually ‘providing a service’ to an employee and hence GST should be applied on that. Under the rules of GST, GST is taxed on every activity which is treated as supply of service.
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