CA in Jaipur | CA. Yogesh Jangid |ITR Filing 2023 | Company Registration | NGO Registration | Income Tax Raid Cases | Audit | Inc Incroporation | CPA in India | Subsidy | Project Funding | GST | GST Raid Cases | Income Tax Notice Faceless | DRI Cases | https://www.nyca.in ITR Filing 2023 | Company Registration | NGO Registration | Income Tax Raid Cases | Audit | Inc Incroporation | CPA in India | Subsidy | Project Funding | GST | GST Raid Cases | Income Tax Notice Faceless | DRI Cases Thu, 27 Jun 2024 07:08:30 +0000 en-US hourly 1 https://wordpress.org/?v=6.9.1 https://www.nyca.in/wp-content/uploads/2022/08/9060CA_logo_icai-1.jpg CA in Jaipur | CA. Yogesh Jangid |ITR Filing 2023 | Company Registration | NGO Registration | Income Tax Raid Cases | Audit | Inc Incroporation | CPA in India | Subsidy | Project Funding | GST | GST Raid Cases | Income Tax Notice Faceless | DRI Cases | https://www.nyca.in 32 32 CBIC Circular No. 218/12/2024-GST: Taxability of Loans Between Overseas and Indian Affiliates Clarified https://www.nyca.in/cbic-circular-no-218-12-2024-gst-taxability-of-loans-between-overseas-and-indian-affiliates-clarified/ https://www.nyca.in/cbic-circular-no-218-12-2024-gst-taxability-of-loans-between-overseas-and-indian-affiliates-clarified/#respond Thu, 27 Jun 2024 07:08:30 +0000 https://www.nyca.in/?p=11609 Understand the implications of CBIC Circular No. 218/12/2024-GST on GST taxability for loans between overseas affiliates and Indian counterparts or related entities. Learn about exemptions, taxable supplies, and GST compliance guidelines.

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CBIC has issued Circular No. 218/12/2024-GST dated June 26, 2024, providing clarification on the taxability of transactions involving loans provided by overseas affiliates to their Indian counterparts or by persons to related entities within India.

The Circular addresses concerns from industry stakeholders regarding whether GST is applicable on transactions where loans are extended solely based on interest or discount, without additional charges like processing fees or administrative costs.

Key clarifications include:

  • Loans between related parties constitute a taxable supply under GST, as per Section 7(1)(c) of the CGST Act, read with Schedule I, even if no other consideration besides interest or discount is involved.
  • Services related to loans, such as processing or administrative charges, are exempt from GST under Entry 27(a) of Notification No. 12/2017-Central Tax (Rate), provided the consideration is solely represented by interest or discount.
  • However, if fees akin to processing, administrative charges, or loan granting charges are levied in addition to interest or discount, they are considered taxable supplies liable to GST.

The Circular aims to ensure uniform implementation of GST regulations across different field formations and suggests dissemination through appropriate trade notices.

For detailed information, refer to the Circular here.

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