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reverce charge

07 December 2017

tax paid by recipient on reverse charge .....then recipient will pay amount to supplier after deducting the amount of tax ....and then pay govt . it is correct ?

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4 Replies

Divakar (Student CA Final ) (11857 Points)
Replied 07 December 2017

Recipient is liable to pay tax to the government under reverse charge mechanism... For which expenses u r paying reverse charges... Now reverse charges on purchase made from unregistered person is suspended till 31.3.18

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RAJA P M ("Do the Right Thing...!!!") (128091 Points)
Replied 07 December 2017

@ Susmit Nandi.,

Wrongly understand the concept of RCM...
RCM is calculated for the billed total amount. It's exclude calculation...
Ex :
If you received bill value Rs. 10000. It's tax rate @ 5%. Then you ll be pay Tax under RCM basis as
10000 * 5% = 500....

Manu Kumar Rana (New Updates ) (358 Points)
Replied 07 December 2017

Hi, susmit,

Not like that,

Explanation,

If the URD ( the supplier )sold goods rs of 10000/ to the xyz company ( the receipt ). the receipt has to pay tax to Govt as per applicable gst rate on Goods.

The receipt need to pay Rs 10000/- to the URD ( the supplier ) bsz Rs 10000 is basis value for Goods excluding GST.

Now RCM is deferred by the Govt of India up to 31.03.218