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Exceptional item in statement of p&l

Others 252 views 2 replies
does fee related to demerger or merger is exceptional item ?
Replies (2)

Yes, GST (Goods and Services Tax) does have an impact on mergers and acquisitions (M&A). Here are some key points to consider: Transfer of Business: Under the GST regime, the transfer of a business as a going concern, including mergers, amalgamations, and acquisitions, is generally not subject to GST. This means that such transfers do not attract any tax liability under GST1. Input Tax Credit (ITC): During M&A transactions, the availability and transfer of Input Tax Credit can be a significant consideration. Proper due diligence is required to ensure that ITC is appropriately transferred and utilized2. Registration and Compliance: The entities involved in M&A need to ensure compliance with GST registration requirements. This includes transferring or obtaining new GST registrations for the merged or acquired entity2. Inter-Company Transactions: Transactions between the merging entities during the interim period can be subject to GST. Proper documentation and compliance are necessary to avoid any tax liabilities2. Overall, while the transfer of business itself may not attract GST, other aspects such as ITC, registration, and inter-company transactions need careful consideration to ensure compliance and optimize tax benefits.

Exceptional item fee is related


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