Decoding Clarification on levy of GST on Director’s remuneration

• June 13, 2020
• CA Chandan Agarwal's Office

Decoding – CBIC Circular No: 140/10/2020 – GST dt. 10.06.2020 – Clarification in respect of levy of GST on Director’s remuneration

Point of Doubt: –

Whether the remuneration paid by companies to their directors

1. falls under the ambit of entry in Schedule III of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the CGST Act) i.e. “services by an employee to the employer in the course of or in relation to his employment” or

2. whether the same are liable to be taxed in terms of notification No. 13/2017 – Central Tax (Rate) dated 28.06.2017 (entry no.6)

The issue of remuneration to directors has been examined under the following two different categories:

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