Gst Charge on Service Charges or Fees Received?

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praveen Nautiyal (Querist)
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24 January 2024 Dear Sir,

I have a private limited company, we are offering the Vocation course Like Tally, Accountancy or so many course etcs.

now my question is when, we generate gst bill for customer, Is gst charged on service charge, fees or Both Service & Fees ?

Situation-1
Fees Received - 25000
Service charge - 2500
Gst 18% - 450
(Service ------
chage) 27950 total BIll
=====

Situation-2
Fees Received - 25000
Service charge- 2500
Gst 18% 4950
(Fee +Service -------
charges) 32450 Total Bill
=====
Pls confirm...

Asha Kanta Sharma online

Asha Kanta Sharma

(Expert)
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07 July 2024 In the context of providing vocational courses like Tally and Accountancy, the GST treatment typically follows these guidelines:

### GST on Services and Fees

1. **Service Charge**:
- Service charges, such as administrative fees, registration fees, or any charges related to the services provided, are subject to GST. These charges are considered as part of the consideration for the service provided.

2. **Fees for Courses**:
- Fees received for vocational courses, whether it's tuition fees, course fees, or any similar charges directly related to the educational service, are also subject to GST.

### Breakdown of GST Application in Your Scenarios:

#### Situation 1:
- **Fees Received**: ₹25,000
- **Service Charge**: ₹2,500
- **Total Bill**: ₹27,500

- **GST Calculation**:
- GST on Fees (₹25,000): 18% of ₹25,000 = ₹4,500
- Total Bill (including GST): ₹27,500

#### Situation 2:
- **Fees Received**: ₹25,000
- **Service Charge**: ₹2,500
- **Total Bill**: ₹32,450

- **GST Calculation**:
- Total Amount (Fees + Service Charge): ₹27,500
- GST on Total Amount (18%): 18% of ₹27,500 = ₹4,950
- Total Bill (including GST): ₹32,450

### Clarification:
- **GST on Fees**: In both situations, GST is applicable on the fees received for the vocational courses (₹25,000).
- **GST on Service Charges**: GST is also applicable on the service charges (₹2,500) because they are part of the consideration for the service provided.
- **Total Bill**: The total amount billed to the customer includes both the fees for the course and any applicable service charges, with GST applied to the total amount.

### Conclusion:
In summary, GST is charged on both the fees for the vocational courses and any service charges associated with the services provided by your private limited company. Ensure that you calculate GST correctly based on the total amount billed to your customers, which includes both fees and service charges. If you have any specific nuances or further questions regarding GST calculations for educational services, consulting with a tax advisor or GST expert would be beneficial for accurate compliance.