Hi all... I am having a doubt in GST on RCM .....
My client is an transportation servicer . He is paying 5% of tax for transportation charges... Is he can claim input in next month.... If not how can he show it in his books of accounts and GST since money is going out from my client side.....
According to my view, he can't claim since 12% and 18% can only claim input in next month.... But my doubt is how to record this outgoing.....
2 Replies
chaithanya
(Chartered Accountant)
(29 Points)
Replied 31 July 2019
ITC is not eligible in this case as 5% is the GST rate charged on GTA services. The 5% GST is to be expensed-off. The entry can be mentioned as below:
Freight charges Dr 105
To GST liability under RCM @ 5% Cr 5
To GTA Name Cr 100
(Being expenses booking)
GST liability under RCM @ 5% Dr -5
To Bank (GST Payment) Cr - 5
(Being payment made to GST department)
CA Haritha Komma
(Chartered Accountant)
(1147 Points)
Replied 31 July 2019
Is it a GTA service provider (SP) or GTA service recipient (SR)??
The rates for GTA are as follows:
1. 5% under reverse charge - SP should not charge GST and ITC on his expenses is not available to SP. However, the 5% GST paid under RCM by SR can be availed as ITC by SR.
2. 12% under forward charge - SP can charge GST @ 12% to SR and can avail ITC on his expense. The 12% GST so paid by SR to SP can also be availed as ITC.
In brief:
1. SP cannot charge 5% but can only charge 12%.
2. There is no 18% GST rate in case of GTA.
3. SR is eligible for ITC in any of the cases.
4. SP is not eligible for ITC if opts for 5% under RCM by SR.
Entries can be passed accordinly..
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