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No GST on forfeiture of salary or payment of bond amount in the event of the employee leaving the employment before the minimum agreed period

It has been clarified vide Circular No. 178/10/2022-GST dated 03.08.2022, that the salary forfeited, or the bond amount paid by the employee in the event of leaving of employment before the minimum agreed period, is not taxable as consideration for the service of agreeing to tolerate an act or a situation. Further, the employee does not get anything in return from the employer against payment of such amounts.

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