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Reverse charge under Gst

23 June 2018

How to treat transport frieght under RCM as the Vrl logistics had clearly mentioned that Gst is to be payable by consignee by Vrl logistics as we have to pay Tax as Reverse charge and we have to pay it..

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12 Replies

Ravi SADhiyan (Practice) (4510 Points)
Replied 23 June 2018

In case of Logistics they issued invoice after charge GST

In Case of GTA, GST Amt paid by the service recipient under RCM

Exmple:-

xyz ltd receive GTA service of Rs. 10,000/-

than xyz ltd paid GST Amt Rs. 500/- on Freight Amt Rs. 10,000/- under RCM in cash and take ITC benefit

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Rizwan (GST Practitioner) (178 Points)
Replied 23 June 2018

Yes reverse charge machinisam is applicable for transport services under sub-section 3 of section 9

you hv to raise tax invoice and payment voucher under rcm and pay tax @ 5%

itc is available

Gaurav Vij (22 Points)
Replied 23 June 2018

ITC can be availed on payment of 5%??

RAJA P M ("Do the Right Thing...!!!") (128091 Points)
Replied 23 June 2018

@ Gaurav Vij.,

Yes... ITC available for the RCM payment.

Razaq Sha (26 Points)
Replied 23 June 2018

sir in the Vrl invoice they have clearly mentioned that Gst should be paid by the consignee as they have reversed in invoice so we have to pay tax on frieght

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Gaurav Vij (22 Points)
Replied 23 June 2018

Sir then where 12% rate applicabl??

Rizwan (GST Practitioner) (178 Points)
Replied 23 June 2018

if GTA charge gst it will be 5 % with no itc and 12% with itc

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RAJA P M ("Do the Right Thing...!!!") (128091 Points)
Replied 23 June 2018

@ Gaurav Vij.,

The 12% rule applicable to GTA. Not for receipients...

If GTA can't charge GST on his Service (Like Transportion of Road it's exempted under GST. So, they can't charge) then it's will payable by Recipient as rcm and 5%...

If GTA charge 12% then it's not under RCM basis to recipient of Services...

Are you understand...?!

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Gaurav Vij (22 Points)
Replied 23 June 2018

but sir as per the statutory updates recently. GTA cant charge gst it is only on RCM basis isnt it sir?
and if it is so than in GTA services will be taxable only on RCM basis. right?

Sundararajan S (Final Student of ICAI) (1764 Points)
Replied 23 June 2018

GTA has option to either collect 12% or tell the recipient to pay under RCM @ 5% and recipient can take credit in both circumstances. However, option once exercised by GTA is final. 5% without ITC means no ITC for GTA. For recipient ITC fully available.

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Razaq Sha (26 Points)
Replied 23 June 2018

is compensation cess is Applicable for Beedies unpacked Beedies ...?

Pavan Joshi (Accounts Executive) (6 Points)
Replied 28 June 2018

Dear Sir, As per Transportation of Goods By road its not fully exempted from GST ,And only Service provided to Unregistered persons by gta is exempt under GST ( if recipient is Registered Person then the GST amount should be paid by service recipient As per the Notification 13/2017 of CGST). If GTA service provider opts for 5% he cannot claim Input tax credit. Otherwise if he opts 12% then he can claim ITC for his business.