Tax implications on compensation received.

the case of GST, compensation is subject to tax if it is in the nature of a supply. If the compensation is not in the nature of a supply, then GST is not applicable. If the compensation is in the nature of a supply, then the supplier has to charge GST on the compensation.

Any compensation or other payment, due to or received by any person, in connection with the termination of his employment or the modification of the terms and conditions relating thereto is taxable under the head other sources.