The GST & Indirect Taxes Committee of the Institute of Chartered Accountants of India (ICAI) has released the ๐๐ฆ๐ง ๐ฆ๐ฒ๐ฐ๐๐ผ๐ฟ๐ฎ๐น ๐๐๐ถ๐ฑ๐ฒ ๐ผ๐ป ๐๐ต๐ฎ๐ฟ๐ถ๐๐ฎ๐ฏ๐น๐ฒ ๐ง๐ฟ๐๐๐๐ & ๐ก๐ฃ๐ข๐, marking the first publication under its Industry-Specific GST Publication Series. The Guide provides practical insights into the GST implications applicable to charitable trusts, societies, Section 8 companies, NGOs, trustees, professionals and other stakeholders.
๐๐ฒ๐ ๐๐ถ๐ด๐ต๐น๐ถ๐ด๐ต๐๐
Income-tax registration does not automatically grant GST exemption.Registration under Sections 12AA/12AB of the Income-tax Act only establishes charitable status for income-tax purposes. Under GST, exemption depends upon the nature of each individual supply and the availability of a specific exemption under the GST law.
Every receipt requires separate GST evaluation.
A charitable organisation may simultaneously have:
- GST-exempt supplies
- Taxable supplies
- Receipts outside the scope of GSTAccordingly, each transaction should be examined independently.
๐๐ผ๐ป๐ฎ๐๐ถ๐ผ๐ป๐ ๐ฎ๐ป๐ฑ ๐๐ฟ๐ฎ๐ป๐๐
Voluntary donations, corpus contributions and unconditional grants, where no benefit is provided to the donor, generally do not constitute consideration and may remain outside the scope of GST.
However, where donors receive identifiable benefits such as:
- Naming rights;
- Sponsorship benefits;
- Brand visibility;
- Event participation;
- Publicity or promotional benefits the amount received may qualify as consideration for a taxable supply u/s 7 of the CGST Act, 2017
๐ก๐ผ๐ป-๐ฃ๐ฟ๐ผ๐ณ๐ถ๐ โ ๐ก๐ผ๐ป-๐ง๐ฎ๐ ๐ฎ๐ฏ๐น๐ฒ
One of the Guideโs significant clarifications is that the GST definition of โBusinessโ is very wide and includes activities undertaken whether or not for pecuniary benefit.
๐ ๐ฎ๐ท๐ผ๐ฟ ๐๐ฟ๐ฒ๐ฎ๐ ๐๐ผ๐๐ฒ๐ฟ๐ฒ๐ฑ
The Guide discusses GST implications relating to:
- Corpus donations;
- Government grants
- CSR funds;
- Membership subscriptions;
- Educational & training fees;
- Hostel receipts;
- Healthcare services;
- Rental income;
- Religious activities;
- Sale of books/publications;
- Foreign contributions;
- Environmental activities; Yoga & spiritual programmes
๐ฅ๐ฒ๐ด๐ถ๐๐๐ฟ๐ฎ๐๐ถ๐ผ๐ป, ๐ฅ๐๐ & ๐๐ง๐
The publication also provides detailed guidance on:
- GST registration thresholds
- Aggregate turnover computation
- Reverse Charge Mechanism (RCM) on services such as: Legal services; GTA services; โข Sponsorship; โข Security services; โข Renting of immovable property (specified cases)
- GST on digital services
- Availability and reversal of Input Tax Credit (ITC) where both taxable and exempt activities are undertaken.