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CA. M. Lakshmanan

Most of the insurance surveyors’ gross receipts are less than Rs. 20 Lakhs only and those who are getting more than Rs. 10 Lakhs have already registered under the erstwhile Service Tax and as such they are already collecting Service Tax from the Insurance Companies and paying the same quarterly at due dates and of course filing half yearly returns.

Now at the new GST regime they must register under the GST and start collecting GST @ 18% and follow the new procedures under the new Act. But for those who are have not come into the Service Tax net since because their gross receipts are less than Rs. 10 Lakhs and for those who were in the Service Tax net since their gross receipts were more than Rs. 10 Lakhs and who are not likely to have more than Rs. 20 Lakhs per year, the question arises ‘whether they have to register under GST and inform the no. to the Insurance Companies?’ Since all the companies are insisting the surveyors to get them registered.

As per the Act if the gross receipts are less than Rs. 20 Lakhs per year and if the all the receipts are from within the home state they need not register. But in practice most of the Surveyors are doing survey work for an Insurance Company, the Head Office of which is situated in a State other than the Home State and in such cases this service is termed as inter-state service they have to compulsorily register and collect GST for all the services even though their gross receipts are less  than Rs. 20 Lakhs. This involves undue hardship to small surveyors. This issue can be sorted out if the exemption is given for the Insurance Surveyors, whose gross receipts are less than Rs. 20 Lakhs per year including inter-state services and the Insurance Companies come forward to pay the applicable GST under the Reverse Charge Mechanism (RCM).

As of now though the Insurance Companies can pay GST under RCM even for inter-state supplies received, from the surveyors’ point of view the registration is compulsory if they do inter-state services. For this proper representation is to be made to the GST council through appropriate channel i.e. the Indian Institute of Insurance Surveyors and Loss Assosssors (IIISLA) to exempt the Insurance Surveyors from compulsory registration because it is a genuine difficulty, which can be considered by the authorities since it will not result in loss to exchequer because GST will be collected by RCM by the Insurance Companies.

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  1. SARATHI G says:

    Dear Sir,

    I need your assistance in finalizing Value of Supply of service Liable to levy GST Mr. X is an Independent Insurance Surveyor and Loss assessorhold COP in ISSLA ( (Promoted by IRDA) .

    He is getting professional fees for preparing assessment report in claims settlement . SAC- Insurance auxiliary . Under service tax regime he was charging ST on the Fees and Reimbursement both together. Following items are usually showed in Fees bill ( Illustrative purpose only)
    1. Professional Fees (calculated as per the slab rate given by concern authority on Estimated/Assessed Loss against each policy) Re-Imbursements:
    2. Local Conveyance
    3. Digital Photo Charges
    4. CD/DVD Charges
    5. Courier Expenses
    6. Travelling & Outstation Expenses
    7. Miscellaneous expenses

    Now Mr. X has been instructed by a “General insurance company” to charge GST only on the Professional fees portion and to not charge GST on Reimbursement.

    Usually GIC’s will deduct TDS u/s 194J on the Total Value (Fees+ Reimbursement), and many times GIC’s has deducted TDS on (Fees+ Reimbursement+ Service tax).

    If Mr. X charges GST only on professional Fees but at the end of the Financial year 26AS will show the total amount credit including Reimbursement .

    There would be huge difference between amount reported in GST returns and 26AS. I assume

    Mr.X have to pay the GST on the Re-imbursement portion with Interest and Penalty.

    Query: Is it correct not to charge GST on Reimbursement expenses. Give me any references if GST not to be charged on Re-imbursements.

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April 2024