05 March 2024
Sir, I am trader as well as service provider registered under GST & recently become sub-broker for dealing in Share market / opening Demat / Mutual fund etc & earned brokerage from that activity.
please guide as asked by Principal - Issuing GST tax invoice - where to mentioned in GSTR-1
Further, I have credit/cash balance in GST ledger but principal asked copy of Challan for payment of the same.
07 July 2024
As a sub-broker in the share market, you are providing services and earning brokerage income, which is subject to GST. Here's how you can handle invoicing and compliance:
### Issuing GST Tax Invoice:
When you provide brokerage services and earn income from brokerage, you need to issue a GST tax invoice to your principal (the entity for whom you are acting as a sub-broker). Here’s what you should include in the GST tax invoice:
1. **Invoice Details:** - Invoice number and date. - Your GSTIN and the GSTIN of your principal (if applicable). - Name and address of both parties. - Description of services provided (brokerage services). - Amount of brokerage charged. - GST rate and amount charged (if applicable). - Total invoice value.
2. **Place in GSTR-1:** - In your GSTR-1 return, you should report all outward supplies, including the brokerage income. This should be reported in Table 6 (Taxable outward supplies made to registered persons) of GSTR-1.
### Procedural Aspects for Payment and Documentation:
1. **Challan for GST Payment:** - If you have a credit balance in your GST ledger, you can utilize it against your GST liability for the brokerage income. - Generate a GST Challan (GST PMT-06) through the GST portal to make payment. You can select the appropriate amount from your credit ledger to pay your GST liability. - After making the payment, you can download the Challan and provide a copy to your principal as proof of payment.
2. **Compliance and Record-Keeping:** - Maintain proper records of all invoices issued, GST payments made, and returns filed. - Keep copies of GST Challans and other relevant documents related to your brokerage activities.
Description of Service: Brokerage Services in Share Market Amount: [Total Amount of Brokerage]
GST (18%): [GST Amount]
Total Invoice Value: [Total Invoice Amount]
Terms and Conditions: [Your Terms and Conditions]
Signature [Your Signature] ```
### Summary:
- Issue GST tax invoices for the brokerage income you earn from your principal. - Report this income in Table 6 (Taxable outward supplies made to registered persons) of GSTR-1. - Use your GST ledger balance to pay GST liabilities via GST Challan (PMT-06) and provide a copy of the Challan to your principal as requested.
By following these steps, you can ensure compliance with GST regulations while managing your brokerage income as a sub-broker in the share market. If you need further assistance, consider consulting with a tax professional or GST advisor for personalized guidance.
CAclubindia
