hard20 pts · first answer countsgstvaluation

Value of a free corporate guarantee

A holding company gives a bank a corporate guarantee for its subsidiary's ₹50 crore loan for one year, charging nothing. The subsidiary makes exempt supplies, so it cannot take full ITC. What is the taxable value?

A.₹50 lakh, 1% of the amount guaranteedB.Nil, since nothing was chargedC.₹5 crore, 10% of the amount guaranteedD.₹9 lakh, the GST on the guarantee

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Value of a free corporate guarantee

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