Reimbursement of auditor expense gst is applicable?

Reimbursement of auditor expense gst is applicable?
Replies (5)
Quick Summary
This discussion clarifies whether Goods and Services Tax (GST) is applicable on the reimbursement of auditor expenses. Generally, GST is applicable unless the auditor qualifies as a 'pure agent'. A pure agent incurs expenses on behalf of the client, reimbursing them at cost without adding their own markup, and these expenses are clearly itemised on the invoice. The key criteria are that the expenditure is on behalf of the client, and the invoice for the reimbursed expense is in the client's name.

GST is applicable in case Reimbursement of auditor expenses except if the reimbursement of expenses is in nature of "pure agent".
Yes GST would be applicable.
What is pure agent? not clear can you exlpain(Sagar Patel)
A pure agent is one who while making a supply to the recipient, also incurs expenditure on some other supply on behalf of the recipient and claims reimbursement (as actual, without adding it to the value of his own supply) for such supplies from the recipient of the main supply.
The payment made by the pure agent on behalf of the recipient of supply has been separately indicated in the invoice issued by the pure agent to the recipient of service.
And invoice against which reimbursement is claimed is in name of recipient.

Thanks Sagar. Now please reply to the original question. Whether the Auditor should charge GST on conveyance and fooding expenses incurred during Audit from the Client by raising a bill on the client?

 

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