Clarification in respect of levy of GST on Director’s Remuneration

Circular No: 140/10/2020 – GST dated 10.06.2020

The part of Director’s remuneration which are declared as “Salaries‟ in the books of a company and subjected to TDS under Section 192 of the IT Act, are not subject to GST* and not treated as supply in terms of Schedule III of the CGST Act, 2017.

The part of Director’s remuneration which is declared separately other than “salaries” in the Company’s accounts and subjected to TDS under Section 194J of the IT Act as Fees for professional or Technical Services shall be treated as taxable supply for GST and company is liable to discharge the applicable GST on it on RCM basis.

Source

• Circular
• KPMG
• Taxguru – Analysis of GST applicability on Directors Remuneration – Part II

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