Is GST applicable on damages awarded by court to property owner for illegal property occupation or is it an actionable claim and exempt from GST ?
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GST on compensation for unauthorised property occupation
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Court-awarded compensation for illegal property occupation is treated as restitution for loss or damage rather than a consideration for a service. Consequently, it is generally considered outside the scope of GST. However, always ensure the nature of the payment is clearly defined as compensatory in court orders to avoid ambiguity.
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