Go Digit faces ₹384 Cr tax demand.
Go Digit, an Indian insurtech firm, has received a tax demand of ₹384.4 Cr ($46.2 million), including ₹100.4 Cr in interest, from the Income Tax Department for the assessment year 2023-24 (AY24). The demand stems from disallowances related to claim provisions and tax deductions.
The tax demand primarily arises from:
- Disallowance of provisions for claims Incurred But Not Reported (IBNR) and claims Incurred But Not Enough Reported (IBNER).
- Disallowance under Section 40(a)(ia) of the Income Tax Act for non-deduction of Tax Deducted at Source (TDS) on certain expenses.
- Disallowance under Section 40(a)(i) of the Act for non-deduction of TDS on reinsurance premiums paid to non-resident insurance companies.
Go Digit stated that these disallowances relate to industry-wide issues and plans to appeal the decision or explore other legal options. The company will also assess the need for disclosures in its financial statements.
This follows a recent GST demand notice of approximately ₹170 Cr for alleged short payment of taxes over a five-year period. Earlier in the month, the Office of the Commissioner of GST & Central Excise reaffirmed a GST demand of ₹154.80 Cr, along with a penalty of ₹15.48 Cr and applicable interest, pertaining to the period between July 2017 and March 2022.
The GST demand relates to alleged non-payment of GST on co-insurance premiums received as a follower in co-insurance transactions and reinsurance commissions deducted from premiums ceded to domestic and foreign reinsurers.
In Q3 FY26, Go Digit’s net profit increased by 18% to ₹140 Cr, with gross written premium rising 9% YoY to ₹2,909.2 Cr. The company’s total income stood at ₹2,497.7 Cr, up 5% YoY.
About the Author
