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Advance Amount Recevied

17 September 2020

I have Recevied Advance amount Recevied of rs. 35000/- month of April and Goods sent to month of May Balance amount Recevied at time. So any provision og GST law of Adavance amount.recevied ?

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5 Replies

Shivam RC (Student) (23683 Points)
Replied 17 September 2020

Is it for Sale of Goods or Services Sir ???

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Soni Ketan (23 Points)
Replied 17 September 2020

Goods

Ajnas (Student) (844 Points)
Replied 17 September 2020

No, only in case of sevice

1 Like

Shivam RC (Student) (23683 Points)
Replied 17 September 2020

As per Notification No. 66/2017 - Central Tax, dated 15th November 2017 : GST shall not be leviable on ADVANCE Received against sale of "GOODS". This was made effective from "15th November 2017."

So as per your query, following are the answers :

1). When you received the Advance of Rs. 35,000 in the month of April 2020, you are required to issue a Receipt Voucher to the Recipient since GST cannot be collected on advance amount against sale of goods.

2). And in the month of May, when the Goods are being despatched, you are required to issue a Tax Invoice by virtue of Section 31 of the CGST Act 2017, and the GST shall be collected on the entire consideration i.e. value of supply ( Advance Amount + Amount Receivable /Received ).

Therefore GST shall be collected in the month of May and accordingly the same needs to be deposited to the Government exchequer in the month of June by filing FORM GSTR-3B.

Hope it is clear...

Regards,
Shivam RC.

2 Like

Sagar Patel (Tax and Business Consultant) (11611 Points)
Replied 18 September 2020

Provision of GST law for Advance amount received is only applicable for Service, not for Goods..So, in your case you are not required to pay any GST on advances...Pay total GST as per Tax invoice only.