GST on Coaching Centers: AAR No. 08/AP/GST/2020 Explained
Private coaching centers for professional courses like CA and CMA must pay GST as they do not qualify as educational institutions.
- Ruling
- AAR No.08 /AP/GST/2020 dated:05.03.2020
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
The short version
- Coaching centers are not recognized educational institutions under GST law.
- Coaching services for CA and CMA courses are taxable.
- Hostel and catering services provided by coaching centers are not exempt.
In short
The company asked if their coaching services for CA and CMA students, along with food and hostel facilities, were exempt from Goods and Services Tax (GST). The Authority for Advance Ruling (AAR) examined whether these services fell under the exemptions granted to educational institutions.
What has changed
How it worked before
Many private coaching centers assumed that because they teach students to pass exams for recognized professional qualifications, they should be treated as educational institutions and exempted from GST.
What has changed
The authority decided that coaching centers are not educational institutions because they lack formal accreditation or affiliation from statutory bodies like the ICAI. This means coaching fees, as well as charges for food and accommodation, are fully taxable. In practice, coaching centers must now collect and pay GST on all these services.
Who this affects
Owners of private coaching centers, tuition providers, and professional training institutes preparing students for competitive or professional exams.
An example
Imagine a private institute that provides coaching for medical entrance exams. They might wonder if they are exempt from GST because they help students reach a recognized degree. Based on this ruling, they would likely be considered a taxable service provider, not an educational institution, and would need to charge GST on their fees.
What you should do
If you run a coaching center, you should assume your services are taxable. Remember that this ruling only legally binds the company that asked for it; however, it shows how tax authorities view the status of coaching centers. You should consult with your tax advisor to review your specific business structure and tax liability.
If you do nothing
If you incorrectly assume you are exempt, you may fail to collect and pay the required GST. This can lead to tax officers issuing demand notices for unpaid tax, along with interest and penalties. Being wrong about your tax status can create a significant and unexpected financial burden for your business.
The terms explained
- Educational Institution
- An entity that provides education as part of a curriculum for a qualification recognized by law, or as part of an approved vocational course.
- Statutory Body
- An organization established by an act of Parliament or state legislature, such as the Institute of Chartered Accountants of India.
- Advance Ruling
- A written decision provided by tax authorities to a business regarding how tax laws apply to their specific activities.
The ruling in detail
Authority for Advance Ruling
M/s. Master Minds
AAR No.08 /AP/GST/2020 dated:05.03.2020 · Andhra Pradesh
Questions before the authority
- Whether the services of supply of service of education as per the curriculum prescribed by the statutory authorities/ government to the students of the applicant for obtaining qualifications/ certificates of CA-Foundation, CA-Inter, CA-Final, CMA (ICWA)-Foundation, CMA-Inter, CMA-Final and Intermediate duly recognized by the respective statutory authorities/ government are exempted under Notification No.12/2017-CT (Rate) dt.28.06.2017 (entry no.66(a)), as amended?
- Whether the charges collected for providing accommodation to the students undergoing the above courses are exempted from GST as provided under Notification No.12/2017-CT (Rate) dt.28.06.2017 (entry no.14), as amended read with Circular No.32/06/2018-GST dt.12.2.2018 since the amount charged from the students by the hostel run by the applicant is less than Rs.1000/- per day?
- Whether the charges collected by the applicant for catering service by supplying food to the students undergoing the above courses are exempted from GST as provided under Notification No.12/2017-CT (Rate) dt.28.06.2017 (entry no.66(a)), as amended?
Facts
The applicant is a proprietary firm providing coaching services for Chartered Accountancy (CA) and Cost Management Accountancy (CMA) courses, as well as Intermediate education. The applicant sought a ruling on whether these coaching services, along with the provision of food and accommodation to students, qualify for GST exemption as an educational institution. The applicant argued that their coaching is part of a curriculum leading to recognized qualifications.
Ruling
| Question | What the authority ruled |
|---|---|
| Exemption for coaching services | Not eligible Applicant does not qualify as an educational institution |
| Exemption for accommodation charges | Not eligible Applicant does not qualify as an educational institution |
| Exemption for catering services | Not eligible Applicant does not qualify as an educational institution |
The Authority ruled that the applicant does not qualify as an educational institution under the relevant notifications. Consequently, the coaching services, as well as the supply of food and accommodation, are not eligible for the claimed GST exemptions. The applicant is required to pay GST on these services.
Reasoning
The Authority reasoned that the applicant is not an educational institution as defined in Notification No.12/2017-Central Tax (Rate) because it is not accredited, affiliated, or authorized by the statutory bodies (ICAI/ICWAI) to impart the curriculum. The coaching provided is merely a **facilitation or improvisation** for students to appear for exams, rather than being part of a curriculum prescribed by law. Furthermore, the applicant does not issue any recognized certificates or diplomas. Therefore, the services do not meet the criteria for exemption under entry 66(a) or entry 14 of the notification.
Provisions relied on
- Section 97(2) of CGST/APGST Act, 2017
- Notification No.12/2017-Central Tax (Rate) dated 28.06.2017
- Circular No.32/06/2018-GST dated 12.02.2018
- Circular No.85/04/2019-GST dated 01.01.2019
For the practitioner
This ruling clarifies that private coaching centers for professional courses like CA and CMA do not qualify as educational institutions for GST exemption purposes. It establishes that **lack of formal accreditation or affiliation** with the statutory body is a decisive factor. Practitioners should note that this ruling denies the exemption for both the core coaching services and ancillary services like food and accommodation provided by such centers.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/ap_aar_08_2020_05.03.2020_mm.pdf
Legibility of the scan, as read: high.
Prepared 20-10-2026.
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