New Delhi: AAR specifies the quantity of GST that should be paid on worker medical medical health insurance premiums. Firms, together with statutory entities, can be responsible for items and providers tax on medical medical health insurance premiums paid by their workers.
Even municipal and different statutory entities that obtain tax exemption on completely different providers they supply should pay GST on medical medical health insurance premiums for workers, in keeping with the Telangana Authority of Advance Ruling (AAR). Learn Extra: Need to replace Aadhaar Card sitting at dwelling? This may grow to be actuality quickly
The Telangana AAR determination got here in response to a request by M/s. Hyderabad Metropolitan Water Provide and Sewerage Board, which wished to know if it was obliged to pay GST on medical insurance coverage premiums paid to supply medical health insurance to workers, pensioners, and their relations. Learn Extra: LIC Jeevan Umang Coverage: Right here’s easy methods to get Rs 36,000 pension by saving Rs 45 each day
The applying additionally requested an earlier judgment on the taxability of the car insurance coverage coverage bought to cowl the Board’s autos. The AAR decided that providers supplied by a municipality are eligible for GST exemption beneath Article 243W of the Indian Structure. These providers are instantly associated to the capabilities acknowledged within the twelfth schedule for such organisations.
The AAR discovered that the insurance coverage providers bought by the applicant had no relationship to the actions carried out by them beneath Article 243W, and therefore these providers don’t qualify for exemption. The AAR decided that premiums paid for car insurance coverage are excluded if the car is used to hold out statutory obligations allotted to municipalities.
Such autos is not going to have a direct relationship to the duties undertaken beneath Article 243W if they’re utilised to move workers, board members, or different folks. Because of this, the AAR concluded that it’s going to not be eligible for exemption.