Is Gst Charged on service charges, fees Received or both Service Charge + Fees Received?

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praveen Nautiyal (Querist)
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24 January 2024 We are a Pvt ltd. company, we are offer vocational course like tally, accountancy.

when we will bill to customer, is gst charged on service charge, fees received or both service charge + fees received?

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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09 July 2024 In your case, when billing your customers for vocational courses like Tally and accountancy, GST (Goods and Services Tax) is typically charged on the fees received from the customer. Here’s how it generally works:

1. **Service Charge vs. Course Fees:**
- **Service Charge:** If you charge any additional service fees apart from the course fees (for example, registration fees, exam fees, or administrative fees), GST is applicable on these service charges as well.
- **Course Fees:** The main component of your billing will likely be the course fees paid by the customer for attending the vocational courses. GST is charged on these course fees.

2. **GST Application:**
- **GST Rate:** The applicable GST rate for educational services like vocational training courses is typically 18% (9% CGST + 9% SGST/UTGST).
- **Invoicing:** When you prepare your invoices, you will calculate GST at the applicable rate (18% in most cases) on the total amount of fees received from the customer, including any applicable service charges.

3. **Example:**
- Suppose you charge Rs. 10,000 as course fees and Rs. 500 as registration fees. The total invoice amount will be Rs. 10,500.
- GST will be calculated on Rs. 10,500 at 18%, resulting in Rs. 1,890 as GST (CGST Rs. 945 + SGST/UTGST Rs. 945).
- The total amount payable by the customer will be Rs. 12,390 (Rs. 10,500 + Rs. 1,890).

4. **Billing Process:**
- Clearly mention the GST amount separately on your invoice along with the breakdown of fees and service charges.
- Ensure that your invoice complies with GST regulations, including correct GSTIN (GST Identification Number) and other mandatory details.

By following these guidelines, you ensure compliance with GST regulations while billing your customers for vocational training courses. If you have specific questions or need further clarification based on your business setup, consulting with a GST practitioner or tax advisor would be beneficial.