Dear Experts,
Can a Head office (in one state) issue an invoice to the branch (different state)?
Please note both HO and branch use the same PAN No. and HO is not registered as an ISD.
Thanks
6 Replies
Amit Potadar
(Consultant)
(135 Points)
Replied 08 March 2021
Hi Gouri,
Can you please elaborate?
I am not getting you clearly, is it Cross charge or normal invoice you are asking?
Gouri Sankar Tripathy
(Employed)
(78 Points)
Replied 08 March 2021
Hi Amit,
To be more precise...The HO which is registered (under GST) in the state, intend to invoice some services they have rendered to the branch. The branch is situated in a different state and has separate GST registration. Is that doable? Also, can the HO utilise the ITC available in ECL to discharge the output liability?
Thanks
Amit Potadar
(Consultant)
(135 Points)
Replied 08 March 2021
Hi Gouri,
Thanks for the input,
This is cross charging, You can recover the portion of common expenses incurred by the HO from Branch by raising invoices to the respective branches.
Tax Implications are as follows.
1. HO can avail the ITC on common expenses incurred.
2. Cross charge liability need to pay by HO only.
There will no double GST Payment as HO liability will be equal to the ITC.
Gouri Sankar Tripathy
(Employed)
(78 Points)
Replied 08 March 2021
Thank you Amit! One last question. When HO is liable to discharge the output liability, can they use their accumulated ITC for discharging the duty?
Amit Potadar
(Consultant)
(135 Points)
Replied 08 March 2021
Yea, its FCM liability. You can offset that with your ITC.
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