Amount received for security services including amount of wages for guards taxable @18%

Last updated: 23 February 2021

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Quick Summary

The Gujarat Authority for Advance Ruling (AAR) has determined that GST at 18% is applicable to the entire amount received for security services, including the wages paid to security guards. This ruling clarifies that the 'consideration' for such services encompasses all payments made by the client, not just the establishment charges. The applicant is eligible for Input Tax Credit (ITC) provided they follow the correct GST payment procedures on the full transaction value.

Court :
Gujarat AAR

Brief :
The Hon’ble AAR Gujarat in M/s Gujarat Industrial Security Force Society [Advance Ruling No. GUJ/GAAR/R/100/2020 decided on October 14, 2020] held that the security services would be taxable to GST @18% on the entire amount received including the wages for the guards. Input Tax Credit ('ITC') would be available if the procedure of paying GST is followed on the entire amount received by assessee, subject to the fulfillment of the conditions as envisaged in the relevant sections and rules of the Central Goods and Services Tax Act, 2017 ('CGST Act') and Central Goods and Services Tax Rules, 2017('CGST Rules').

Citation :
Advance Ruling No. GUJ/GAAR/R/100/2020 decided on October 14, 2020

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