Circular clarifies that insurance companies are not liable to ...

Insurers needn't pay GST on salvage deducted from claims as it remains insured's property. But if claim settled without deduction, insurer must pay GST on salvage sale.

Circulars GST - States

August 6, 2024

Circular clarifies that insurance companies are not liable to pay GST on salvage/wreck value deducted from claim settlement amount, as salvage remains property of insured. However, if claim settled without salvage deduction, salvage becomes property of insurer who must discharge GST on subsequent supply. For total loss cases where salvage deducted from claim amount as per policy terms, no GST payable by insurer on salvage value as ownership remains with insured. For claims settled at full insured value without salvage deduction, salvage ownership transfers to insurer necessitating GST payment on eventual sale.

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Circular clarifies that insurance companies are not liable to ...

Insurers needn't pay GST on salvage deducted from claims as it remains insured's property. But if claim settled without deduction, insurer must pay GST on salvage sale.

Circulars GST - States

August 6, 2024

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