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Head office salary costs to attract 18% GST for services to offices in other states

Salary for services such as accounting, IT, and human resource provided by the head office of a company to its branch offices in other states will attract 18% GST. According to an order passed by the Karnataka Bench of the Authority for Advance Rulings (AAR), activities between two offices are treated as supplies under the GST law. It said the valuation of supply would include all costs, including the employee cost, provided by one distinct entity to other distinct entities. The GST charged on such supplies can be claimed as input tax credit, but exempt companies will not be able to claim credit. Also this will increase the compliance burden because companies will have to raise invoices for all such inter-state services.

Read More at Livemint News date : 14 Aug 2018, Tuesday

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