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Reverce charge on Rent

R.S.TRADING CO. (30 Points)

13 October 2017

well if I paid rent to unregistered person it's comes under reverse charge or not

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13 Replies

RAJA P M ("Do the Right Thing...!!!") (127921 Points)
Replied 13 October 2017

From October RCM not applicable for above said way...
But, wait for further notification...

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CA Rashmi Gandhi (Chartered Accountant) (86308 Points)
Replied 13 October 2017

Till sept same is covered under RCM if amt is more than Rs.5000/.

However same is suspended from October.....

RAJA P M ("Do the Right Thing...!!!") (127921 Points)
Replied 13 October 2017

Suspended from October.....!

But, wait on further notification from CBEC

R.S.TRADING CO. (30 Points)
Replied 13 October 2017

well I have to pay rent Rs 14000 per month from July and I will pay it now in Oct so reverse charge applicable on July August & Sep is also applicable if we paid it in Oct month

RAJA P M ("Do the Right Thing...!!!") (127921 Points)
Replied 13 October 2017

Yes...
Exactly applicable RCM for the above said periods...

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RAJA P M ("Do the Right Thing...!!!") (127921 Points)
Replied 13 October 2017

Yes...
Exactly applicable...

anshul aggarwal (Consultant) (1074 Points)
Replied 13 October 2017

RCM is not on payment. It is when an expense is credited to the account. So your rent for July Aug and Sept will come under RCM as rent is monthly.

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CA Rashmi Gandhi (Chartered Accountant) (86308 Points)
Replied 13 October 2017

I am disagree with you anshul aggarwal.

In my view it is based on payment. So he has not to pay under RCM.

RAJA P M ("Do the Right Thing...!!!") (127921 Points)
Replied 13 October 2017

No....
Payments are adjustable to expenditure account. It's not applicable in Tax head...

anshul aggarwal (Consultant) (1074 Points)
Replied 13 October 2017

Rashmi,
Does that mean if we buy from URD worth 10000 and make payment as 3000, 3000 and 4000 on different dates. Then RCM will not be applicable?
I don't think it has anything to do with payment. It is when bill is credited irrespective of payment is done. Your views will be appreciated.

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CA Rashmi Gandhi (Chartered Accountant) (86308 Points)
Replied 13 October 2017

but as per CGST Act,

In case of reverse charge, the time of supply shall be the earliest of the following dates:

The date of paymentThe date immediately after 60 days from the date of issue of invoice by the supplier

anshul aggarwal (Consultant) (1074 Points)
Replied 14 October 2017

Yes I agree with you.
In this case time of supply is monthly rent receipt.
But dealer is not Accounting the same and making quarterly payment for same. But rent agreement will decide time of supply which is monthly.

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