Education is process of training and developing knowledge, skill and character of students by normal schooling. Education sector has always been a sensitive issue as it is more of a social activity than a business one. As a result, this sector enjoys a lot of exemption as they are not taxed or comes in negative list.

 

1. Exempted services

 

1. Services supplied by an educational institution to its students, faculty and staff is exempt from GST

 

2. Services provided by educational institution to conduct entrance examination in the form of entrance fee is exempt

 

3. All services supplied to recognized educational institution relating to admission or conduct of examination by such recognized education institution will be exempt

 

4. Services supplied to educational institution of supply of online journals above HSC is exempt

 

5. Service of hire of motor vehicle for transportation of students, faculty and staff up to HSC is exempt

 

6. Services supplied to recognized educational institution from pre-school to HSC are exempt

 

2. Exemption not available to graduation and post-graduation courses

 

1. Transportation of students, faculty and staff

 

2. Catering, including midday meal scheme sponsored by the government

 

3. Security or cleaning or housekeeping services performed in such educational institution

 

4. Canteen services supplied in college by the educational institution itself is exempt. However, such service is taxed at 5% where it is supplied by through a contractor.

 

5. No GST is payable on hostel accommodation provided by educational institution to students even if amount is recovered on yearly basis

 

6. Training or coaching in recreational activities relating to arts or culture or sports by charitable entities registered under section 12AA of the Income Tax Act are exempt

 

7. Boarding schools provide education services coupled with other services like dwelling units for residence and food. It is naturally bundled and supplied in the ordinary course of business. In the case of boarding school, predominant element of such bundle is that of providing education. Therefore, entire consideration for such supply is exempt.

 

3. Exemption is not available for Executive Development Management

 

Below mentioned services are exempt under GST:

 

1. NSDC set up by the Indian Government

 

2. NSDC approved assessment agencies

 

3. National skill development programs approved by NSDC vocational skill development program approved under national skill certification and monetary reward scheme

 

4. Any scheme implemented by NSDC with training partners

 

Commercial education is taxed at 18%, other services related to education, not covered by the exemption would be taxed at 18% with full ITC available in cases where no output service is exempt.

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