letter dated 19.09.2025 to all HoCs.pdf
F. No. zglnlzoz5-Lr
Govt. of India
Ministry of Communications
Department of Posts
Directorate of Postal Life Insurance
Chanal<yapuri PO Complex,
New Delhi -rro ozr
Dated: - rg.o9.2oz5
To,
All Heads of Circles.
Subject:Change in rates of Goods & Services tax (GST) on services of individual life insurance business with effect from zz September zoz5.
Sir/Madam,
Enclosed herewith please find a copy of Government of India, Ministry of Finance (Dcpartment of Revenue) Notification No: 16lzoz5 Central Tax (Rate) Dated 17.g.2oz5 (Annexure - I) vide which the GSI'rate on services of life insurance business provided by an insurer to the insured, where the insured is not a group has been rcduced to'NIL'with effect from zz September zoz5.
Necessaty modifications are being incorporated in tl-re McCamish system centrally to give effect to the cl-range in tax rate on PLI & RPLI policies from the stipulated date. A copy of the cl-ranges being made in the software, depending upon various premiun-r and default fee payment scenarios is enclosed (Annexure - II) with this letter lor your kind information.
GS'l' will however continue to be billed and deposited with the tax authoriry on Reverse Charge Mecl-ranism basis on the incentive being paid to the sales force as per tlre existing practice. It may, however, be noted that Input tax credit of the GS'l paid on RCM bosis on the incentive paid to so/es force of PLI €, RPLI cannot be availed by the Post offices with effect from zz September zoz5.
It is requested that these instructions nlay be dissentinated to all Post offices under your jurisdiction for guidance and compliatrce.
This issues with the approval of CGM PLL
Encl:As above.
(
AccountsO
Copy to:
r. GM (O) PLI Dte, New Delhi.
z) DPLI, I(olkata - for information and with request to above instructions to all PAOs/DDOs for pay-recovery Ministries/Dept.
kindly disseminate the policies of other
lnnex,,rru L @
Iro nr PUtsLISIJED IN THE GAZETTE oF INDI^. EXTRA.RDTNAR'. pART rr. sECTI.N 3, suB-sECTroN (i)] Govcrnment of India
Ministry of Finance
(Department of Revcnue)
Notincation
No. l6 /2025-Central Tax (llatc)
New Delhi. rhe lTrh Septenrber, 2025
G S'R' -----(E)' - In exercise ofthe powers confened by sub-sections (3) and (4) ofsection 9, sub-section (l) ofsection ll, sr'rb-section (5) of section l5 and section 148 of'the Central Goocls and Services Tax Acr, 2017 (l2ol20l7), the Cenh'al Goveument, on being satisfied that it is nccessaly in thc putrlic intcrest so to do, on the recommendatio,s of the Llouncil, hereby Ilrakes the lbllowing lirrther arnenclnrents in thc rrotillcatiorr ol'the Governrnent of'Inclia, in the Ministrl of Finance (Departrnent of Rcvenue), numbcr l2l20l'7-Ccnt|al rax (Rate). dated the 2gth June,20l7. publishcd in thc Gazetle ollndia, Extraordinary, Part II, Section 3, sub-section (i). vide number G.S.R. 69 l(E), dated the 2llrh.lune,2017, nan-rely:--
In the said notification.-
(a) In thc rable, -
(i) against serial nunlber 18, in colunrn (3), aftcr clause (b), the follorving explanation shall bc inscrte.l, nar,cly:- "Explanation. - Nothing contained in this cntry shall apply to:
(i) local dclivcry seryiccs provided by an Ercct.onic corn,crcc opcrator; or
(ii) local delivery services provided through an Electlonic C--onrnrcrcc opcrator.,,;
(ii) atter serial nu,rber 368 and the qrtrics relating thereto, the following scrial nuurbers and entrics relatirru thercto shallttc inserted, nalrcly: -
(t) (2) t1t (4) (5)
"36C
Heading 997 I Senriccs of lif-e insuran.. lru.in.rip.ui,JEi bffi NIiI
I'Ji I
insurer to thc insured, where the insured is not a
group.
IPlease rcl'cr to clause (zlb) in para 2l
Explanution; For the renroval ofdoubts, it is hereby
clarilied that:
a. This exer.nption shall apply to a contract ol
irrsulance where thc insurcd is an
individual, or an individual artd family of
the said intliviclual.
b. For thc purposes of (a) above, ftrrnily shall
inclucle all individuals insured as lamily in
thc contract of insurance.
36D Nir Nil
Ilcading 997 I Scrvices of hcaltli insurancc business providcd by
an insurcr to the insrtrcd. rvhcrc the insttrcd is not a
group.
[Pleasc refer to clausc (zfb) in para 2]
Explurrutiort: l"or the rcmoval oldoubts, it is hcreby
clari fled that:
a. This cxcrnption shall apply to a
contract of insurance whcre the
insured is an individual, or an
individLral and farrily of the said
individual.
b. I'-or the purposes of (a) above, farrily
shall includc all individuals insured
as lanrily in the contract of insulance.
368 Hcading 9971 Nil Ni1";
Itcinsuancc of thc insurancc sctviccs specificd in
scrirl nuurbers 36C or 36I).
(b)
in paragraph 2,
for clause (zc), the following shall be substitutcd, natlely: -
(i)
"(zc)'goods tl'anspoft agcncy' means any person who provides selicc in relation to transport of goods by road and issncs a consignmcnt note by whatever natrtc called, but does rrot include
(i) an elcctronic comlllercc operator by whom the sctviccs of local delivcry arc provided, (ii) an electronic comrnerce o[)crator through rvhorn the services of local delivery are providecl";
(ii)
alier clause (zla), the tbllorving clause shall be inserted, narnely:-
"(ztb) For rhe pulposcs of cntlies at scrial nunrbers 36Cl and 36D in the table above, 'group' nteans gt'ottp of pcrsons rvho join together with a cormnonality of purpose or for engaging in a cottunon econortric activity, other than availing insurance, and includes:
a. E,urployer- enrployee grolrps, whu'c an eutploycr-ernployee relationship exists betwcen thc rnastcr/group policyholdcr and tlre mcmbers of'the groLrp in accordance with thc applicablc larvs'
b. Non enrployer- err-rployee groups, where a clearly evident relationship exists between the 6astcr/group policyholdcr and thc nrcmbers of thc gloup, lor scrviccs/ activities othcr than ittsurancc.";
(iii) altcr clause (zg), the tbllorving clausc shall bc insclted, natne:ly: -
"(zga) 'hcalth insurancc lrusincss' rncans the ctfccting ofcontracts rvhiclt provicle fbr sickness bcncfits or rlredical, surgical or hospital expense benefits, whether in-patient or out-patient, travel cover and personal accident cover;".
2. This notitlcation shall conre into force u,ith cffect ll'orn the 22''d day of Septernber,2025,
lF.No. 1 9034 I /l 88/2025-TRUI
(Md. Adil Ashral)
Undcr Secretary to thc Govctrttttent of India
Nore: The principal norillcation No. l2120 l7 - Central Tax (tLate), dated the 28'r'June,20l7 rvas publrshed in the (]azette of Inclia. Ext;aoldinaty, Part Il, Section 3, Sub-section (i) vide nuntbcr G.S.R. 691 (E). datcd thc 28'r'Junc,20l7 atld was lasr alrended vide notitlcation nunrber 06/2025-Ccntlal Tax (lLatc), datcd the l6'r'Januaty, 2025 publishcd in thc Gazette ollnclia, Extrlorclinary, vide rrumbcr G.S.R. 4l(E). dirtcd thc l(r'r' January, 2025.
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ANNIXURE II
POSSIBLE SCENARIOS IN RESPECT OF GST EXEMPTION ON PLI/RPLI CONSOLIDATED IN TABUTAR FORM
S.N. Head PAYMENT RECEIVED ON OR
AFTER zzND SEP
2oz5 FOR POLICY
DUE IN SEP-25
MONTH or any
PREVIOUS MONTH
(i.e. r" Sep as per PLI
policy or any
prcvious month for
which premium was
unpaid)
PAYMENT
RECEIVED ON OR AFTER zzND SEP 2c.21, FOR POLICY DUE ON OCT MONT}-I AND .TI]I1RIAFTER (i.e. r't Oct zoz5 as per PLI policy)
TAPSE
POLICYREVIAL POST zzND SEP 2025
I Poliry payment on renewal
PREMIUM
Policy payment
{ - GST Payable As per Normal Provision (NO CHANGE)
{ - GST Payable
X NO GST GST payable on premium recovered
which was due on
or before Sep-zoz5
and No GST on
premium due on or
after Oct zoz5
N.A. N.A.
l.l
on New Policy accepted up to 2r-09-2O2\
As per Normal Provision (NO CHANGE)
1.2 Policy payment on New Policy
accepted after zr
09-2025
X NO GST X NO GST N,A.
2 l,ate payment charges I default
fee
{ GST Payable @ t8o/a
(NO CHANGE)
X GST Exempt from policy due on or after Oct 2o25
GST payable on default fee recovered on policy due in Sep-zoz5 and No GST on or after Oct-zoz5
RCM I-iability on Incentive paid to agent will contir-rue as per existing structure. ** I{eferences: - Provision mentioned in Sec lt(:)(a) of GST Act. For details FAQ available on CIIIC website rnay also be seen.
1
FAQ on GS'l'rate change in l'l,l and ITPLI
QUERY Cl.rrific.rtion
Q.no.r For policies where advance prgmium is already calculated, do we need to revert the CST for them?
Q.no.z For Renewal scenarios where Suspense amount is greater or equal to the Total Amount to be collected, system collects the GST amount for receipt generation and adjusts the premium amount from Suspense, this scenario will be impacted with the current, so DOP to confirm on the minimum amount which can be considered for receipt generation for such cases
Q..ro.3 For Ilevival and Reinstatement cases how to calculate tl-re GST?
For e.g.: For a policy if the PTD= 3t-Mar-zoz5, and user is coming on z3-Sep for lleinstatement.
Do we need to charge the GST for Apr-Atg-z5 month?
OR
GST should be applicable on the Total premium amount?
Q.no.+ Also what will happen to the collections whicl-r has happened before deployment, do the GST needs to be reverted?
Q..ro.5 For HRMS , pay demand file get generated on r5th of every month, and the response of which comes through pay deduction file by 6tn of every month, and with Phase z changes this date should move to 3'd of every month, so the changes in GST components for HRMS file should be considered from Oct-25 month.
Q.no.6 Similarly for SI/NACH as well all the demand files gets generated by rgth of every month and response of the same is also received within the same month, so again the changes in GST comPonents for these files should also get considered from next month (Oct-zS) onwards.
No. Refund of GST shall not be permissible if premium stands collected GST shall be reflected on receipt if due and collected, as per the GST scenario mentioned in table.
GS'f will only be charged upto Sept. 2oz5 month policies premium and Default fee (as due datc is first of the month)
e.g. April to Sept-25
No. Refund of GST shall not be permissible if premium stands collected GST exemption w.e.f. Oct
2025.
GST to be deducted from tl're salary of Sept-zoz5 (as due date is first of the month)
GST exemption w.e.f. Oct
2025.
GST to be deducted for the m/o Sept-zoz5 (as due date is first of the month)