ITC eligibility for group insurance, Goods and Services Tax - GST

[RameshBabu Kari]

Dear Experts,

One of the company takes the group insurance for their employees. for the payment of premium, company deducting some portion of salary from the employees to pay the insurance premium and Insurance company will provide bill on the company name, not one the employee names. Here company collecting the premium and paying to the insurance company. Can ITC be claim on the insurance by the company as bill received on company name? What are the provisions applicable on this issue ?

Posts / Replies

[HimansuSekhar Sha]

As per sec 17(5) of the CGST Act

(b) the following supply of goods or services or both-

(iii) rent-a-cab, life insurance and health insurance

The credit is not eligible

[KASTURI SETHI]

I support the views of Sh.Himansu Sha, an expert.

[HimansuSekhar Sha]

Thank you for your support sir

[Nandan Khambete]

Under GST, ITC credit of GST paid is not available on rent-a-cab, health insurance and life insurance except the following:

1. Government makes it obligatory for employers to provide it to its employees
2. goods and/or services are taken to deliver the same category of services or as a part of a composite supply, credit will be available

So, if the insurance is taken because of obligation by the Government, Example: Insurance under Workman Compensation Act, Company can claim ITC.

Trust above clears the doubt.

Regards,

CA Nandan Khambete

[RameshBabu Kari]

Thank you all

[HimansuSekhar Sha]

OK

Sir

[KIRTIKUMAR PUROHIT]

if insurance is taken to fulfill Government obligation in this case ITC available on that policy other wise ITC Not available.

[Ramaswamy S]

Tax paid on any service used for personal consumption is not eligible for ITC (Negative List).

If the service is used in the course of furtherance of business then ITC is allowed.

So it is important to determine whether the service is for furtherance of business or is it for personal consumption.

Regards

S.Ramaswamy