applicability of GST on reimbursements
This query is : Resolved
Vinay sawant
(Querist)
01 November 2017
Should GST be charged on debit notes raised (for reimbursement) to one shareholder of the company for the expenses (electricity,office cleaning charges etc.) incurred wholly by another shareholder ? Assuming both the shareholders are directors of the company ?
Udaya Chandran
(Expert)
01 November 2017
Usually, GST is not applicable on reimbursements to employees and to other suppliers if it is shown separately provided some conditions are satisfied.
02 November 2017
The bills should be in the name of the company to claim reimbursement. In such cases, no GST between Company and director.
However, if the bills are not in the name of the company, but are rather in the director's name, then considering that there is no employer employee relationship between a director and the company, the reimbursement shall be subject to GST.
However, if the bills are not in the name of the company, but are rather in the director's name, then considering that there is no employer employee relationship between a director and the company, the reimbursement shall be subject to GST.
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