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Rcm on freight by composition dealer

Anitya ( ) (287 Points)

12 April 2019

Good Evening Members.

Please let me know if taxpayer registered under composition scheme, needs to pay GST under RCM on freight paid to GTA. If yes, then what at rate?

Thanks

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Deepak Gupta (CA Student) (15922 Points)
Replied 12 April 2019

Rule 5(1)(d) of the CGST Rules, specifies that a composition dealer shall pay tax under sub-section (3) or sub-section (4) of section 9 on inward supply of goods or services or both.

Sec. 10(1) of the CGST Act, also says that, “…but subject to the provisions of sub-sections (3) and (4) of section 9…” This means that while complying with one statutory provision, another provision relating to the subject-matter also must be complied with.

So, this means that RCM tax shall be paid by composition dealer as well.

GTA RCM falls under 9(3) as notified supply even if GTA is unregistered.

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Anitya ( ) (287 Points)
Replied 12 April 2019

At what rate GST to be paid by composition dealer on RCM?

virender (prop) (131 Points)
Replied 13 April 2019

@ 5%

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Sagar Patel (Tax and Business Consultant) (11611 Points)
Replied 22 July 2020

If it's a GTA then 5% GST on RCM basis applicable subject to conditions that GTA is not paying tax @ 12% with ITC
If GTA charge you GST @ 12% than RCM is not applicable

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