The Central Board of Indirect Taxes and Customs (CBIC) has introduced a new taxation system – Goods and Services Tax (GST) with a slogan One Country and One-tax. Even though it’s been years after the GST Tax implementation, there is a lot of confusion among the Tax slabs and rates among customers. Particularly, there is a lot of confusion among people on the statements of CBIC on tax liability for banking and financial transactions. The confusion arose when many banks received notices for non-payment of services tax on free services offered to their customers under the pre-GST regime. Here we’ve mentioned a few banking and financial transactions for which you need to file GST return to let you know.
Credit Card Penalties
You are not liable to pay Tax if you are using your credit card properly i.e., paying credit card bills on-time. Any negligence shown towards clearing debits could impact negatively on your credit score. According to the CBIT’s GST norms, the penalty for the delayed credit card bill payments will be chargeable to GST. Hence, if you delay your credit card bill payments, you need to file GST tax on those charges.
NRIs Life Insurance Policies
The payments towards the premiums of Life Insurance policies issued to NRI are taxable. All these payments from the NRIs will be received through a non-resident external account. Since these payments will be made in Indian rupees and not in convertible foreign exchange, NRIs are liable to GST payment.
Impact of GST on Mutual Funds
After the implementation of GST, many investors have a common question, ‘will the investments made in mutual funds attract GST?’ According to the CBIC, the exit load charged by mutual funds in the form of the fee will attract GST. So, investors of mutual funds are liable to pay GST while making an exit.
However, hiring a GST expert to handle all the tasks involved in GST filling costs much to the enterprise. Instead, you can invest in KENTax – an advanced Tax Management System of KENCloud to make the GST filing hassle-free. SBININBB825 SBININBB326