GST on entrance fees or admission fees from students by educational institutions

It is evident that educational services supplied by educational institutions to their students are exempt from GST vide entry no. 66 of the Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017. The Relevant portion of the entry is as follows:

“Services provided-

  a. By an educational institution to its students, faculty, and staff;

[(aa) by an educational institution by way of conduct of entrance examination against consideration in the form of entrance fee;] …”

Representations have been received by the CBIC as regards applicability of GST on the application fee charged for entrance or the fee charged for issuance of eligibility certificate for admission or for issuance of migration certificate by educational institutions in terms of the aforesaid entry. To clarify, the CBIC issued Circular no. 177/09/2022 dated 3^rd August 2022. The clarification is as follows:

• In view of entry no. 66 of the Notification No. 12/2017- CT (Rate) dated 28.06.2017, it can be seen that all services supplied by an ‘educational institution’ to its students are exempt from GST. Consideration charged by the educational institutes by way of entrance fee for the conduct of entrance examination is also exempt.

• The exemption is wide enough to cover the amount or fee charged for admission or entrance or the amount charged for the application fee for entrance, or the fee charged from prospective students for the issuance of an eligibility certificate to them in the process of their entrance/ admission to the educational institution.

• Services supplied by an educational institution by way of issuance of migration certificates to the leaving or ex-students are also covered by the exemption. Accordingly, such activities of an educational institution are also exempt.

• Accordingly, it is clarified that the amount or fee charged from prospective students for entrance or admission, or for issuance of eligibility certificates to them in the process of their entrance/admission as well as the fee charged for issuance of migration certificates by educational institutions to the leaving or ex-students is covered by the exemption under Sl. No. 66 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.