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Freight in invoice

TAYA JI (30 Points)

25 June 2017

My query, is GST applicable on
freight show or add in invoice and is adjustable against output if any
to buyer of that goods? thanks

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14 Replies

Sharmila Paruchuru (CA) (39 Points)
Replied 25 June 2017

yes GST is applicable on freight charges . taxable value includes any amount collected incidental to sale

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Sharmila Paruchuru (CA) (39 Points)
Replied 25 June 2017

yes it is adjustable against input

TAYA JI (30 Points)
Replied 25 June 2017

if not shown in invoice, then GST applicable on that invoice

Virendra Chauhan (Manager Accounts) (121 Points)
Replied 01 August 2017

will you plz clerify that freight is to charges in invoice as a product or to be add in product cost, also if is shown as a prtoduct what will the rate of GST on freight.

Shashikant Varshney (Chartered Accountant) (763 Points)
Replied 01 August 2017

This is the case of Mix Supply. You need to charge GST on freight on the rate of Principle Supply.

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Virendra Chauhan (Manager Accounts) (121 Points)
Replied 03 August 2017

Plz clearify that if We are charging freight in Invoice on behalf of Purchaser and the transporter will raised invoice to our account, Then plz do treatment regarding this query, how this will adjust with freight as income and exp.

Virendra Chauhan (Manager Accounts) (121 Points)
Replied 03 August 2017

Shashikant Varshney (Chartered Accountant) (763 Points)
Replied 03 August 2017

Dear Chauhan Sir,

As I understand your case, the bilty is "Already Paid" or "to be Billed". In this case you n eed to charge GST on Invoice Value included Frieght.

For example:- You sold goods of Rs. 10,000 (Ex-Freight) (Assuming Rate of GST in 18%) and 1000 Rs, you paid as Freight to Transporter. 'You need to raise a invoice of Rs. 11,000/- and applicable GST on that (i.e. 18 %) Rs. 1980. Now come to other side you paid 1,000 Rs. as Freight to Transporter, you have to Pay 5% under reverse Charge as GST. (Here deptt not clarify that the credit of 5% is available or Not).

For any further clarification, Pls Whatsapp me on 8826435242

Kaushik Deepak (KD) (Officer Accountant) (1136 Points)
Replied 03 August 2017

Originally posted by : Shashikant Varshney
	Dear Chauhan Sir, As I understand your case, the bilty is "Already Paid" or "to be Billed". In this case you n eed to charge GST on Invoice Value included Frieght. For example:- You sold goods of Rs. 10,000 (Ex-Freight) (Assuming Rate of GST in 18%) and 1000 Rs, you paid as Freight to Transporter. 'You need to raise a invoice of Rs. 11,000/- and applicable GST on that (i.e. 18 %) Rs. 1980. Now come to other side you paid 1,000 Rs. as Freight to Transporter, you have to Pay 5% under reverse Charge as GST. (Here deptt not clarify that the credit of 5% is available or Not). For any further clarification, Pls Whatsapp me on 8826435242

@ Shashikant Sir,

can you give reference regarding GST charged on freight because As far as we have read, GST will be charged for packing and forwarding charges and not on freight

Because neither had any tax on freight when calculating the bill

Virendra Chauhan (Manager Accounts) (121 Points)
Replied 03 August 2017

Thanks you Sir.

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Shashikant Varshney (Chartered Accountant) (763 Points)
Replied 03 August 2017

This is just a case of Mixed Supply. Where you are selling goods (is a one Supply) and providing transport Service (is another supply) as per section 9.

In CGST Act, it is nowhere mention that freight need be included in value.

Kaushik Deepak (KD) (Officer Accountant) (1136 Points)
Replied 03 August 2017

Originally posted by : Shashikant Varshney
	This is just a case of Mixed Supply. Where you are selling goods (is a one Supply) and providing transport Service (is another supply) as per section 9. In CGST Act, it is nowhere mention that freight need be included in value.

According to me, it is the same sir, no where mention that freight need be included in value

because there was no tax on freight even before GST while calculating the bill

Shashikant Varshney (Chartered Accountant) (763 Points)
Replied 03 August 2017

Originally posted by : Deepak Kr. Sharma
	Originally posted by : Shashikant Varshney This is just a case of Mixed Supply. Where you are selling goods (is a one Supply) and providing transport Service (is another supply) as per section 9. In CGST Act, it is nowhere mention that freight need be included in value. According to me, it is the same sir, no where mention that freight need be included in value because there was no tax on freight even before GST while calculating the bill

No, as per excise there is different concept, there is tax but we misinteperate that and take benefit of that. The rule is Freight collect less actual paid is liable to excise.

Kaushik Deepak (KD) (Officer Accountant) (1136 Points)
Replied 03 August 2017

Originally posted by : Shashikant Varshney
	Originally posted by : Deepak Kr. Sharma Originally posted by : Shashikant Varshney This is just a case of Mixed Supply. Where you are selling goods (is a one Supply) and providing transport Service (is another supply) as per section 9. In CGST Act, it is nowhere mention that freight need be included in value. According to me, it is the same sir, no where mention that freight need be included in value because there was no tax on freight even before GST while calculating the bill No, as per excise there is different concept, there is tax but we misinteperate that and take benefit of that. The rule is Freight collect less actual paid is liable to excise.

Sir, I am working in Pharma Manufacturing Company, which is also working in excise duty, in the case of imported material tax is calculated on freight, not on the goods purchased by us in India.