Goods and services tax authorities in some states have sent notices to companies seeking information about the remuneration of directors and the tax paid on them.The notices were sent in view of the two conflicting orders passed by the Authority of Advance Ruling (AAR) in Rajasthan and Karnataka. The AAR Rajasthan is of the view that director remuneration is under the ambit of GST, while the AAR Karnataka ruled it was not.

This issue has serious consequences for companies, especially in the services sector, where they need individual registration in each state. Therefore, a clarification by the GST Council in this respect will put an end to the matter.

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