- The GST Council in India is set to clarify the issue of input tax credit for life insurers, following a recent Rs 290-crore demand on Life Insurance Corporation (LIC).
- The issue arises from traditional life policies or endowment plans, where GST is levied on only a portion of the plan.
- The problem relates to the input tax credit claimed on the portion of premium that is exempted from payment of GST.
- LIC has received a notice from GST authorities and there are concerns that other companies may also face similar demands.
- The process of clarification is expected to take a few months.
- LIC had previously stated that the notice related to claims of Rs 167 crore, with interest of Rs 107 crore and a penalty of Rs 17 crore for “nonreversal of the input tax credit”.
Source: timesofindia.indiatimes.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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