Nisha Yadav (Accounts exe) (455 Points)
19 June 2017We all know that reverse charge GST will be apllicable when a registred supplier purchae goods or services from unregistered supplier. But what about in following case ?
is RCM applicable in these cases?
CS Nisha Nishit
(Practicing Company Secretary)
(326 Points)
Replied 19 June 2017
From my point of view,
RCM will be applicable on the goods or services recieved from unregistered supplier, in the course of furtherance of business.
Nisha Yadav
(Accounts exe)
(455 Points)
Replied 19 June 2017
Thanks
but what if in case no 1 .. I have a office in my mother house and paying rent to my mother?
CA Saloni
(Manager-Accounts & GST Consultant)
(5124 Points)
Replied 19 June 2017
Madam,
In second case, RCM is applicable.
In third case, if you hire labour from an agency and it is registered, then RCM not applicable
rocky
(accountant)
(948 Points)
Replied 19 June 2017
1)“Reverse charge’’ means the liability to pay tax by the recipient of supply of goods or services
GOODS MEANS GOODS WHICH YOU PURCHASE AND SALE.
STATIONARY ITEMS ARE NOT GOODS , IF YOU DONT RESALE THAT.
SO NO RCM APPLICABLE.
2)RCM IS NOT APPLICABLE ON RENT
Nisha Yadav
(Accounts exe)
(455 Points)
Replied 19 June 2017
Dear Rocky kindly read RCM law Carefully
PRABIR PAUL
(*****Accountant***** Never insult to any person for any kind of lack of knowledge or misread.)
(1443 Points)
Replied 19 June 2017
I think section 9(4) of CGST ACT will be very hardship for all person if it is true that reverse charge is applicable all type of expenses.... As it liable to pay reverse charge on all type of expenses..
During the year some company declare fake expenses to reduce profit... Now that will be very hardship.....
Here Point no. 3 about labour I think not applicable because labour may consider wages and wages may consider as salary..
So I think here reverse charge is not applicable on salary...
But if labour has been given by an unregistor supplier then reverse charge applicable...
PRABIR PAUL
(*****Accountant***** Never insult to any person for any kind of lack of knowledge or misread.)
(1443 Points)
Replied 19 June 2017
Maximum people saying that reverse charge is applicable on all type of expenses if purchase it from unregistered dealer but I don't believe it....
Why and How a person pay reverse charge on conveyance expenses, Milk, Tea or any other small type of expenses?
I think here Mr. Rocky is correct only the topic of "Goods' as same imagination I have....
If a product is not your ITEM(PURCHASE AND SALE) then you don't need to pay reverse charge.....
But ITC available on all cases....
Nisha Yadav
(Accounts exe)
(455 Points)
Replied 19 June 2017
A registered person would be required to pay GST on all supplies received by it from un registered person.
And supplies inculde :
Sale, Transfer, Barter, Exchange, Licence, rental
So i don think it is only for goods
need further advice from expert
CS Nisha Nishit
(Practicing Company Secretary)
(326 Points)
Replied 19 June 2017
I have a office in my mother house and paying rent to my mother?
GST would be applicable on RCM basis as it is a taxable supplies.
Explaination :As per section 9(4), supply of taxable goods or services or both from unregistered supplier to registered supplier, on RC basis, recipent will be liable to pay tax in relation to such supply.
if you hire labour from an agency and it is registered, then RCM not applicable
If you just hire a labour, and has employer and employee relation, GST is not applicable as it is neither a services or goods as per Sch III
Nisha Yadav
(Accounts exe)
(455 Points)
Replied 19 June 2017
Thanks Ms. Nisha for your reply.
RCM concept is not easy to apply. Now we have to pay RCM GST on indirect exp like . Stationery, Conveyance, Rent
Please God help us :(
CS Nisha Nishit
(Practicing Company Secretary)
(326 Points)
Replied 19 June 2017
GST regime will be self compliant system.
In this scenario, almost all the registered dealer will prefer to get their supplies whether it be goods or services from registered persons. Therefore, the supplies of unregistered suppliers will be effected.
Indirectly it is making all unregistered suppliers to get themselves registered under GST to avail the benefits and to retained their registered customers.
harsh gupta
(harsh)
(22 Points)
Replied 20 June 2017
rocky
(accountant)
(948 Points)
Replied 20 June 2017
PRABIR PAUL
(*****Accountant***** Never insult to any person for any kind of lack of knowledge or misread.)
(1443 Points)
Replied 20 June 2017
Section 9(4) of CGST ACT 2017 I think it's
Incomplete Provision.........
Very Hardship......
Very Unfair......
Very Illogical....
Because this section didn't prescribed about expenses only it said that we have to pay reverse charge if purchase from unregistered dealer..............
I think department shall be look into this matter......
Please forward this forum to Govt...
CAclubindia
