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health insurance under gst

Jayasheel Seemakurthi (10 Points)

01 April 2018

A company is paying group health insurance for its employees whether company can claim GST credit on such amount paid

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9 Replies

RAJA P M ("Do the Right Thing...!!!") (128101 Points)
Replied 01 April 2018

Yes...
Company Can claim the ITC...

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Rahul Prajapati (Student) (2282 Points)
Replied 01 April 2018

As a general ITC is not allowed on Health Insurance and Life Insurance

Exception ::

Government makes it obligatory for employers to provide it to its employees

2 Like

Jayasheel Seemakurthi (10 Points)
Replied 01 April 2018

thank you for the reply but the exact provision is
1. the Government notifies the services which
are obligatory for an employer to provide
to its employees under any law for the time
being in force.
where the govt has notified , is there any notification

RAJA P M ("Do the Right Thing...!!!") (128101 Points)
Replied 01 April 2018

As per my view.,
No more notification as per above...
Also it's not a self consumed expenditure. A employer will give the opportunity to his employees. It's purely business related expense and avail the ITC benefits...

1 Like

Pankaj Rawat (GST Practitioner) (55057 Points)
Replied 01 April 2018

Yes I agree to Rahul , if Government makes it obligatory,. pls refer section 17 (5) , the extract of same is as below

iii] rent-a-cab, life insurance and health insurance except where--

[A] the Government notifies the services which are obligatory for an employer to provide to its employees under any law for the time being in force; or

[B] such inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as part of a taxable composite or mixed supply

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Rahul Prajapati (Student) (2282 Points)
Replied 01 April 2018

Originally posted by : RAJA P M
	As per my view., No more notification as per above... Also it's not a self consumed expenditure. A employer will give the opportunity to his employees. It's purely business related expense and avail the ITC benefits...

Yes i am also agree with u sir..

Its a business related expenditure and ITC should be allowed..

But as per sec 17(5) it is not allowable.

Please update me also in this matter

Nirav Worah (CHARTERED ACCOUNTANT) (396 Points)
Replied 02 April 2018

All expenses incurred by the Comapny are ideally business expenditure. However, as per Section 17(5) of the CGST expenses, some of the expenses incurred by the Company are not allowed as credit to the Company.

In the instant case, credit of health insurance should not be available as the same is restricted as per 17(5) and there is no notification from the Government which notifies such services to be obligatory to be provided to employee.

Further, it may be noted that similar provisions was also there under the CENVAT credit Rules. Courts have held such credit to be ineligible under earlier provisions.

Regards,

Nirav

CA Naveen Chand (Chartered Accountant) (12739 Points)
Replied 02 April 2018

NO ITC FOR HEALTH & LIFE INSURANCE

1 Like

Mudit Bhansali (0 Points)
Replied 02 April 2018

Section 17(5) is not obstante clause , so irrerepective of the fact that when the expenditure is incurred for furtherance of business or it is related to your business , ITC is not allowed in the cases specified under the said section , further it is only allowed when the conditions as enunciated in the section are fulfilled it complied with