Gst On Free Samples.


Muthu Kumaran
watch_later 1 year, 10 months ago

Whether GST would be chargeable in case of free samples where no consideration is charged?

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1 Answer

Pulkit Sharma watch_later 1 year, 10 months ago
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GST is to be charged on value of supply. If you are supplying goods for free then there be no GST. However you need to first read valuation rules. There are certain condition under valuation you need to take care of.

For example, if you supply good to relatives, you have to follow valuation rules.

Though there is no tax on free sample, but you need to reverse or pay input tax utilised on inward supplies of these free samples.

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    Sir, if a manufacturer gives free samples of his finished product (FP). and the FP is made from various Raw Materials (RM), which are of different GST Rates and also GST Nil. So how does he calculate the ITC Reversal for the free samples issued ? - Basheer PM
    Alternatively, for the issue of free samples, can he raise a sale invoice at a nominal price, and then pass a journal entry by debiting his Sales & Promotional Expenses for the Sale value ? - Basheer PM
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