Goods and Services Tax (GST) compliance becomes complex when businesses incur expenses on behalf of clients, partners, or related entities and later seek to recover these costs. Misclassification of such recoveries—whether as reimbursements, disbursements, or recharge of expenses—can lead to incorrect GST reporting, potential penalties, or missed input tax claims.
This interactive workshop by CLA Events is designed to equip finance professionals, accountants, and business owners with a clear understanding of the GST rules governing the recovery of expenses. Participants will gain practical insights into distinguishing between different types of expense recoveries and learn how to apply GST correctly in various business scenarios.
A Highlight of Key Areas:
Introduction to GST Treatment for Expense Recovery
- Overview of key concepts
- Importance of correctly classifying expense recovery
Key Differences Between Reimbursement and Disbursement
- Definitions and GST implications
- How to determine whether an expense is a reimbursement or disbursement
Principal vs. Agent Relationship
- Understanding when you are acting as a principal or an agent
- Key indicators to determine the relationship
- Impact on GST treatment
Recovery of Expenses in Different Scenarios
- Ancillary to a Primary Supply
- When expense recovery is part of a main supply
- GST treatment and documentation requirements
- Separate and Not Ancillary to Any Primary Supply
- Cases where expense recovery is an independent transaction
- GST implications
Mark-Up vs. Cost Recovery
- Does adding a mark-up change the GST treatment?
- Comparison between recovering expenses at cost vs. with a profit margin
Common Pitfalls & Compliance Considerations
- Mistakes to avoid in GST reporting
- Documentation and record-keeping best practices
Q&A & Case Studies
- Practical examples to reinforce learning
- Interactive discussion on real-world scenarios
- This structured outline ensures a clear and engaging workshop that covers both theoretical concepts and practical applications of GST treatment for expense recovery.