Details of rcm
This query is : Resolved
23 September 2017
PLEASE PROVIDE ALL THE DETAILS OF RCM AS PER GST RULES.
23 September 2017
Detail of all services under RCM & rates
https://www.caclubindia.com/forum/details.asp?mod_id=426394
you can access from this.
21 July 2024
Under the Goods and Services Tax (GST) regime in India, the Reverse Charge Mechanism (RCM) is a mechanism where the recipient of goods or services is liable to pay GST instead of the supplier. This mechanism shifts the liability to pay tax from the supplier to the recipient of the goods or services. Here are the key details of RCM as per GST rules:
### Applicability of Reverse Charge Mechanism (RCM):
1. **Nature of Supply:** RCM applies to specific categories of supplies and services as notified by the government. As of the latest updates, RCM primarily applies to:
- Goods or services notified by the government where the recipient is liable to pay GST.
- Certain specified goods and services, including goods transported by road where the supplier is an unregistered person (for specified categories).
2. **Registered vs. Unregistered Supplier:** Generally, RCM applies when the supplier is an unregistered person or where the notified goods or services fall under specific categories.
### Key Points to Note:
1. **Recipient's Liability:** Under RCM, the liability to pay GST shifts to the recipient of goods or services. The recipient is required to pay GST directly to the government instead of the supplier collecting and remitting it.
2. **Input Tax Credit (ITC):** The recipient who pays GST under RCM can claim input tax credit for the tax paid, subject to compliance with GST laws.
3. **Threshold Exemption:** There is no threshold exemption for RCM. It applies irrespective of the turnover of the recipient.
### Notification and Compliance:
1. **Notification:** The government notifies specific goods and services for which RCM is applicable. These notifications specify the categories of goods or services and the applicable rates.
2. **Payment of GST:** The recipient liable under RCM must comply with GST payment rules and timelines as applicable.
### Accounting and Documentation:
1. **Invoice Requirements:** Proper documentation, including tax invoices and compliance with invoice rules, is crucial when RCM is applicable.
2. **Record Keeping:** Maintain records of RCM transactions, tax payments, and reconciliation for GST filing and audit purposes.
### Recent Developments and Updates:
1. **Changes in Applicability:** The government periodically reviews and updates the list of goods and services under RCM based on policy changes and GST Council decisions.
2. **Compliance Updates:** Stay updated with GST law changes and compliance requirements related to RCM through notifications, circulars, and updates from GST authorities.
### Conclusion:
Understanding and complying with the Reverse Charge Mechanism (RCM) under GST is essential for businesses, especially for those dealing with notified goods and services. It shifts the tax liability from the supplier to the recipient, impacting cash flows and compliance obligations. Businesses should consult with tax advisors or GST experts to ensure proper compliance with RCM rules and regulations under GST laws in India.
### Applicability of Reverse Charge Mechanism (RCM):
1. **Nature of Supply:** RCM applies to specific categories of supplies and services as notified by the government. As of the latest updates, RCM primarily applies to:
- Goods or services notified by the government where the recipient is liable to pay GST.
- Certain specified goods and services, including goods transported by road where the supplier is an unregistered person (for specified categories).
2. **Registered vs. Unregistered Supplier:** Generally, RCM applies when the supplier is an unregistered person or where the notified goods or services fall under specific categories.
### Key Points to Note:
1. **Recipient's Liability:** Under RCM, the liability to pay GST shifts to the recipient of goods or services. The recipient is required to pay GST directly to the government instead of the supplier collecting and remitting it.
2. **Input Tax Credit (ITC):** The recipient who pays GST under RCM can claim input tax credit for the tax paid, subject to compliance with GST laws.
3. **Threshold Exemption:** There is no threshold exemption for RCM. It applies irrespective of the turnover of the recipient.
### Notification and Compliance:
1. **Notification:** The government notifies specific goods and services for which RCM is applicable. These notifications specify the categories of goods or services and the applicable rates.
2. **Payment of GST:** The recipient liable under RCM must comply with GST payment rules and timelines as applicable.
### Accounting and Documentation:
1. **Invoice Requirements:** Proper documentation, including tax invoices and compliance with invoice rules, is crucial when RCM is applicable.
2. **Record Keeping:** Maintain records of RCM transactions, tax payments, and reconciliation for GST filing and audit purposes.
### Recent Developments and Updates:
1. **Changes in Applicability:** The government periodically reviews and updates the list of goods and services under RCM based on policy changes and GST Council decisions.
2. **Compliance Updates:** Stay updated with GST law changes and compliance requirements related to RCM through notifications, circulars, and updates from GST authorities.
### Conclusion:
Understanding and complying with the Reverse Charge Mechanism (RCM) under GST is essential for businesses, especially for those dealing with notified goods and services. It shifts the tax liability from the supplier to the recipient, impacting cash flows and compliance obligations. Businesses should consult with tax advisors or GST experts to ensure proper compliance with RCM rules and regulations under GST laws in India.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- ITC temporary reversal and reclaim
- GST on export of services and Input Credit
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- Inventory of finished goods
- Applicable TDS rate for sale of property in Nov 2024
- Confusion around Form 26QB fields
- GST ON EXPORT COMMISSION
- RCM INVOICING FROM NOV-2024
- Tds on building rent monthly
- Disallowance of Section 43B(h) to sez units
- Regarding Waiver of Interest levied u/s 50 of PGST/CGST Act
- LAST YEAR 2022-23 ITC IN NEXT YEAR 2023-24 REPORITNG IN GSTR-9
- MIS MATCH OF INVOICE NUMBER
- IGST Credit-Show cause notice issued-confusion
- Issue of gst e invoice
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
Trending Online Classes
CAclubindia
