Avalara > Blog > Goods and Services Tax > No GST on salary to full-time directors

No GST on salary to full-time directors

  • Jun 2, 2020 | Divita S Gupta

The Authority for Advance Ruling in Karnataka has put to rest the controversy on whether GST is applicable on remuneration paid to directors of a company. In its order dated May 4, the AAR bench has clarified that GST will not be applicable on remuneration paid to a director if the director is a full-time employee of the company. However, if the director is a non-executive or independent director, then remuneration paid in such a case will attract GST under reverse charge mechanism.


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Avalara Author
Divita S Gupta
Avalara Author Divita S Gupta
Divita has served as a writer and editor for top financial services organizations in India. She has written on topics like mutual funds, insurance, taxes, SME financing for globally recognized banking and financial organizations including ICICI, Aditya Birla Group, News Corp. With a Masters in Business Administration from Symbiosis International University, she currently owns a small business in Mumbai.