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Gst on travel agents

24 June 2017

If am providing services of agent suppose booking tickets for customers but am not a tour operator what is the GST applicability?

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6 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (179966 Points)
Replied 24 June 2017

18% with ITC

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Vijay Sesha Sai Madireddy (52 Points)
Replied 24 June 2017

thankyou sir.

the valuation of services provided by Air Travel Agents can be categorized into two parts:

For Domestic Booking – 5% of the basic fare
For International Booking – 10% of the basic fare

here basic fare means?

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (179966 Points)
Replied 24 June 2017

A base fare is the price of airline ticket before fees, taxes, development cess or any surcharges are added.

Check any air ticket..........Base fare is mentioned first then every other fees taxes etc are addedup to arrive at final fare.

Usually base fare is almost half of the total fare!!!

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Vijay Sesha Sai Madireddy (52 Points)
Replied 26 June 2017

Thankyou sir,

What if air travel agent book accomodation also?

K CS (17 Points)
Replied 14 July 2017

PLEASE SEE THIS ..BY CA. H.M. Talha Rahman, Partner, Selvarajan & Co., Chartered Accountants, Chennai,

THEY SAY GST FOR AIR TRAVEL AGENT FALLS UNDER REVERSE CHARGE BUT IS THIS CORRECT ?

THEY GAVE GST TAX CALCULATION FOR SUCH AGENTS AS = COMMISSION - (COMMISSION * 100/COMMISSION+18)

CONSIDERING MY CASE. MY AGENCY IS GST REGISTERED. WILL I PAY 18% OF COMMISSION IN GST IN REVERSE CHARGE BASIS OR REGULAR BASIS ?

IF REGULAR BASIS THEN PLS ADVISE THE CALULATION

TRAVEL & TOURISM INDUSTRY:
Tourism Industry and travel and tour agents in particular are facing a tough time due to various factors like no commission by the airlines, direct marketing of airlines, higher taxation, poor tourist infrastructure etc. Their major sources of income are listed below:
1. Commission from Airlines, Cruise Companies, Travel Insurance Companies etc
2. Sale Tour Packages, both inbound and outbound
3. Travel Related Services like Visa, Passport etc.
4. Incentives Received from CRS Companies

Now we shall deal how GST is calculated on these items.
Commission from Airlines, Cruise Companies, Travel Insurance Companies etc:
1. One has to understand that an airline or a cruise ticket or the travel insurance policy issued by insurance companies is a contract between the airline/cruise/insurance company and the passenger. The travel agent is only a facilitator who receives commission from the companies. Hence GST on these ticket/policy will only be consumed by the passenger and the agent cannot use them as their input credit.
2. However the agent has to pay GST on the commission received from the airline/cruise/insurance companies on the reverse basis. (For Example, if the GST is 18% and the agent receives Rs. 100 as commission, he has to pay only Rs.15.25 (100-100/118%) as GST). This amount of Rs. 15.25 should not be collected from the passenger.
3. If the agent collects Service Fee as an additional charge from the passenger and show it in the invoice separately, he can add GSTon the service fee in the invoice and collect the same from the passenger.

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AHMED AH (Propietor) (27 Points)
Replied 22 July 2017

Now as stated , that the travel agent should charge 18% on commission earned or service charge , but if the whole years total commission and service charged earned is below 20 Lakhs and i am a registered GST member , should we still collect the 18% GST or is it ok if we dont charge anything ? please clarify