GST on Interest received / Paid if payment made/received after due date

Sir / Madam,

Whether a merchant made payment towards purchase of goods or received payment towards sale of goods in course of business, raised debit note/ credit note towards interest for payment made/received after due date is subject to GST. If yes, then what would be rate of GST?

Almost, there is no GST applicability on interest for payment made to or received after due days on debit /credit note(s).

 

Pls. clarify it.

 

Replies (6)
Quick Summary
This discussion explores whether GST applies to interest charged or paid on transactions when payments are made or received after the due date, particularly concerning debit and credit notes. The consensus suggests that GST is indeed applicable at an 18% rate in both scenarios. If you charge interest on delayed payments, you must add GST. Conversely, if you pay interest, you can claim it as Input Tax Credit (ITC).

18% GST applicable for the interest received against after the due date of payment as per GST...

In both cases  it is subject to gst @ 18%.

In both cases  it is subject to gst @ 18%.

Isn't  it? 

Isn't  it? 

If You are collect interest on delayed payment from Your customers then You will charge GST on that interest...

In case You paid interest and Your supplier will be charge GST on that and You can claim its as ITC...

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