GST on debit note

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This query is : Resolved

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This discussion clarifies whether GST needs to be charged on a debit note when an Indian company, XYZ, issues one to EEPC for reimbursed airfare costs for an exhibition in Dubai. The consensus is that GST is indeed applicable on such reimbursements. XYZ can claim input tax credit on the original airfare invoice, and by charging GST on the debit note, they enable EEPC to claim their input tax credit, effectively nullifying the GST impact for XYZ.

Kaustubh Ram Karandikar

Kaustubh Ram Karandikar (Querist)

09 January 2020 XYZ(India) is participating in an exhibition in Dubai. The Air Fare charges incurred for the same will be reimbursed to XYZ at actuals by EEPC(India) which is a Govt. of India undertaking. For this purpose, XYZ is required to issue a debit note. Is XYZ required to charge GST in the debit note for this transaction?

CA Mohit Bansal

CA Mohit Bansal (Expert)

09 January 2020 Yes, GST is to be charged on reimbursement of expenses also.

Akash Monwani

Akash Monwani (Expert)

09 January 2020 The XYZ will get the Input of Air Fare with the help Invoice recieved by XYZ . Now XyZ need to raise a debit note with same taxable amount and GST so that EEPC can take credit of GST .
XYZ will take the Input on basis of Invoice and pay the output on Debit Note effect of GST will be nullified

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