The Central Board of Indirect Taxes and Customs (CBIC) has issued Circular No. 245/02/2025-GST, providing clarifications on GST applicability for specific services, based on the 55th GST Council meeting recommendations.

𝗞𝗲𝘆 𝗛𝗶𝗴𝗵𝗹𝗶𝗴𝗵𝘁𝘀 𝗼𝗳 𝘁𝗵𝗲 𝗖𝗶𝗿𝗰𝘂𝗹𝗮𝗿 𝗡𝗼

𝗚𝗦𝗧 𝗼𝗻 𝗣𝗲𝗻𝗮𝗹 𝗖𝗵𝗮𝗿𝗴𝗲𝘀 𝗯𝘆 𝗥𝗲𝗴𝘂𝗹𝗮𝘁𝗲𝗱 𝗘𝗻𝘁𝗶𝘁𝗶𝗲𝘀 (𝗥𝗘𝘀): Penal charges levied by banks and NBFCs as per RBI guidelines dated 18.08.2023 will not attract GST, as they are considered deterrents for loan non-compliance rather than a taxable service.

𝗚𝗦𝗧 𝗘𝘅𝗲𝗺𝗽𝘁𝗶𝗼𝗻 𝗳𝗼𝗿 𝗣𝗮𝘆𝗺𝗲𝗻𝘁 𝗔𝗴𝗴𝗿𝗲𝗴𝗮𝘁𝗼𝗿𝘀: RBI-regulated Payment Aggregators (PAs) are now eligible for GST exemption under Sl. No. 34 of Notification 12/2017-CTR, for transactions up to ₹2,000 settled via credit/debit cards. However, Payment Gateways (PGs) are not covered under this exemption.

𝗥𝗲𝗴𝘂𝗹𝗮𝗿𝗶𝘇𝗶𝗻𝗴 𝗣𝗮𝘀𝘁 𝗚𝗦𝗧 𝗣𝗮𝘆𝗺𝗲𝗻𝘁𝘀 𝗼𝗻 𝗥&𝗗 𝗦𝗲𝗿𝘃𝗶𝗰𝗲𝘀: GST payments on Research & Development (R&D) services provided by Government Entities under grants from organizations like DRDO, CSIR, and SERB have been regularized for the period 01.07.2017 to 09.10.2024.

𝗥𝗲𝘀𝘁𝗼𝗿𝗮𝘁𝗶𝗼𝗻 𝗼𝗳 𝗚𝗦𝗧 𝗘𝘅𝗲𝗺𝗽𝘁𝗶𝗼𝗻 𝗳𝗼𝗿 𝗦𝗸𝗶𝗹𝗹𝗶𝗻𝗴 𝗦𝗲𝗿𝘃𝗶𝗰𝗲𝘀: The earlier GST exemption for Training Partners approved by NSDC has been reinstated from 16.01.2025. Additionally, past GST payments on such services for the period 10.10.2024 to 15.01.2025 have been regularized.

𝗚𝗦𝗧 𝗔𝗽𝗽𝗹𝗶𝗰𝗮𝗯𝗹𝗲 𝗼𝗻 𝗙𝗮𝗰𝗶𝗹𝗶𝘁𝘆 𝗠𝗮𝗻𝗮𝗴𝗲𝗺𝗲𝗻𝘁 𝗦𝗲𝗿𝘃𝗶𝗰𝗲𝘀 𝗳𝗼𝗿 𝗠𝗖𝗗 𝗛𝗤: Services like housekeeping, maintenance, and horticulture provided to MCD Headquarters, Delhi, will attract GST, as they are not classified as municipal functions under Article 243W of the Constitution.

𝗪𝗵𝗮𝘁 𝗕𝘂𝘀𝗶𝗻𝗲𝘀𝘀𝗲𝘀 𝗦𝗵𝗼𝘂𝗹𝗱 𝗗𝗼

✔ Review these updates and assess their impact on financial and tax compliance.

✔ Ensure correct GST application on penal charges, payment settlements, and skilling services.

✔ Adjust accounting and invoicing processes for transactions affected by these clarifications.