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gst rate on freight to GTA

15 July 2017

I am supplying two items vide single invoice. gst rate for one item(Paint) is 28% and for other (Mineral Turpentine Oil ) is 18%. Freight is also charged in the bill. What shall be the rate of gst to be charged on freight.

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15 Replies

Arun Kumar Singh (GST Advocate) (15220 Points)
Replied 15 July 2017

If you will add the transportation cost in the transaction value of the goods then buyer can take the cenvat credit. A mixed supply comprising two or more supplies shall be treated as a supply of that particular supply which attracts the highest rate of tax. You should pay the gst on transportation part on higher side.

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Gierish Lokhande (Excise officer) (48 Points)
Replied 15 July 2017

whether again need to pay the GST on reverse charge on freight. When already add in invoice and paid GST on it.

Priyesh Khambhayata (Student CMA) (30 Points)
Replied 15 July 2017

yes, you will required to pay gst under RCM on transport bills @ 5%

Sandeep Upadhyay (1518 Points)
Replied 15 July 2017

Transport by unregistered individual, proprietor are not taxable under RCM in GST

But transport by GTA is taxable under RCM to recipient of services in GST

Lalit Nagpal (Assistant Manager) (541 Points)
Replied 15 July 2017

Vide notification no 13/2017 if GTA services are provided to registered dealer then GST under RCM will be payable and rate for that is 5%

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NITIN KOTAK (SERVICE) (1465 Points)
Replied 15 July 2017

1.0 Introduction
Goods Transport Agency which is commonly known as GTA services is always been a matter of dispute and confusion under earlier laws. Under GST as well, GTA service providers are still guessing on how GST shall impact them and whether they need to register under GST or not.
Hence, we have written this article to clear all doubts, regarding the GST registration for GTA service providers. Let us proceed on to discuss the impact on GTA.

2.0 GTA under complete Reverse Charge Mechanism (RCM)

The government of India via notification no.13/2017 has been kept the GTA services under complete reverse charge. Reverse charge means that GTA is not liable to pay any tax rather the company which is the recipient of the services shall pay the GST in cash to the government.
In simple words, GTA service providers in respect of transportation of goods by road shall not be liable to pay GST.

3.0 Exemption from GST registration for GTA services

If a person is providing only GTA services which are notified under reverse charge (as stated above), then GST registration is not required for them. Further, it is not the option but a regulation. Hence, the tax on GTA shall always be paid by the recipient and not by the GTA service provider.
In simple words, even if the GTA has a turnover of 100 crore, the GST registration shall not be required for them because they are under reverse charge mechanism.
Please read point 6 below.

4.0 GST tax rate on GTA service provider

The GST tax rate for GTA services is 5% and shall be paid under reverse charge.

5.0 Input Tax Credit (ITC) of GST paid on GTA services under reverse charge

The ITC on GST paid on GTA services under reverse charge shall be available to the person who is liable to pay the GST. This is because the GTA service is treated as input service and hence any tax paid on input service is available for ITC.

6.0 Case where GTA service is provided to unregistered dealer

If in case the GTA services are provided to an unregistered dealer then GTA service provider shall be liable to pay GST and register himself under GST. Further, the GST tax rate shall be 5% in case he is not availing any ITC.
However, if he chooses to avail ITC, the tax rate shall be 18%.

Girish Lokhande (Team Member) (35 Points)
Replied 16 July 2017

Whether cenvat credit is available for double time GST paid on freight. What is lojic of government behind it. Is government planning to put swacch Bharat ceas and krishi Kalyan cess on GST on which ITC is not available

sruthi (not yet) (62 Points)
Replied 17 July 2017

Firstly, it is a multiple supply where different supplies were made at different prices. it is not an issue.

Secondly, when sale includes freight it is a composite supply and in that rate on principal supply shall be charged. In this case, since there are two supplies, i think you can choose to tax it on proportionate basis with respective principal supply rates

sruthi (not yet) (62 Points)
Replied 17 July 2017

Firstly, it is a multiple supply where different supplies were made at different prices. it is not an issue.

chakri.aicwai (CMA) (49 Points)
Replied 18 July 2017

5.0 Input Tax Credit (ITC) of GST paid on GTA services under reverse charge The ITC on GST paid on GTA services under reverse charge shall be available to the person who is liable to pay the GST. This is because the GTA service is treated as input service and hence any tax paid on input service is available for ITC.

Read more at: /forum/gst-rate-on-freight-to-gta-407964.asp

Can some one post the official notifiation on this "input service is available for ITC"