Taxes will be levied On Job Hoppers if they fail to serve Notice Period

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Taxes may be levied on job-hoppers who don’t keep their end of the bargain by keeping their offer letter’s notice period. According to a recent judgment by the GST Authority of Advance Ruling (AAR), the employee who fails to provide notice might be charged GST on certain recoveries. Pay during notice, group insurance, phone bill, etc. are all examples of recovery that may be made. In a nutshell, if an employee does not serve their notice term, they will have to pay GST on their monthly wage.

The Mumbai-based tax and investment expert Balwant Jain commented on the GST assessed on the employee who failed to serve the notice period, saying, “According to a recent AAR judgment, recruiters must pay GST via the reverse charge mechanism on the employee’s notice period recovery. Employers might demand that a job hopper pay GST since they aren’t completing their notice period.

Jitendra Solanki, a SEBI-registered tax and investment expert, elaborated on the GST charges on one’s notice pay “There are a number of expenditures that an employee might be reimbursed for during their notice period. Notice money might be paid on an employee’s salary throughout the notice period as well. No notice period is required for the employee who leaves the company without giving notice.

The employer may levy a GST of 18% on any recoveries.”

In the SEBI-registered expert’s opinion, only if the employee has not served the notice period may 18 percent GST be imposed Otherwise, the employer is responsible for paying the GST on the employee’s monthly wage. According to him, a notice period of one month to three months is stated in the offer letter. It’s a good idea for an employee to take note of the notice period as well as the wage split before accepting a new job offer.”

 

 

 

 

Source:ndtv

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