TaxTMI 
TaxTMI 
TaxTMI 
If your ๐น๐ผ๐ด๐ถ๐๐๐ถ๐ฐ๐ ๐๐๐ฎ๐ฟ๐๐๐ฝ transports goods using ๐บ๐๐น๐๐ถ๐ฝ๐น๐ฒ ๐บ๐ผ๐ฑ๐ฒ๐ โroad, rail, or airโdo you know the ๐ฐ๐ผ๐ฟ๐ฟ๐ฒ๐ฐ๐ ๐๐ฆ๐ง ๐ฟ๐ฎ๐๐ฒ? ๐ค
A ๐๐ฟ๐ผ๐ป๐ด ๐ฐ๐น๐ฎ๐๐๐ถ๐ณ๐ถ๐ฐ๐ฎ๐๐ถ๐ผ๐ป ๐ฐ๐ฎ๐ป ๐ถ๐บ๐ฝ๐ฎ๐ฐ๐ ๐ฐ๐ผ๐บ๐ฝ๐น๐ถ๐ฎ๐ป๐ฐ๐ฒ ๐ฎ๐ป๐ฑ ๐ณ๐๐ป๐ฑ๐ถ๐ป๐ด!ย ๐ฐ
๐๐
๐ฎ๐บ๐ฝ๐น๐ฒ: ๐ฆ๐โ๏ธ A startup ships goods ๐ณ๐ฟ๐ผ๐บ ๐๐ฒ๐น๐ต๐ถ ๐๐ผ ๐๐ฎ๐ป๐ด๐ฎ๐น๐ผ๐ฟ๐ฒ:
๐ ๐๐ ๐ฟ๐ผ๐ฎ๐ฑ to a railway station.
๐ ๐๐ ๐๐ฟ๐ฎ๐ถ๐ป to Bangalore.
๐ ๐๐ ๐น๐ผ๐ฐ๐ฎ๐น ๐๐ฟ๐ฎ๐ป๐๐ฝ๐ผ๐ฟ๐ for final delivery.
โ ๏ธ๐๐ฎ๐ฐ๐ธ-๐๐ผ-๐๐ฎ๐ฐ๐ธ ๐ง๐ฟ๐ฎ๐ป๐๐ฝ๐ผ๐ฟ๐ ๐๐ฟ๐ฟ๐ฎ๐ป๐ด๐ฒ๐บ๐ฒ๐ป๐๐ โ Many startups ๐๐ผ๐ฟ๐ธ ๐๐ถ๐๐ต ๐๐ฟ๐๐ฐ๐ธ ๐ผ๐๐ป๐ฒ๐ฟ๐, ๐ฟ๐ฎ๐ถ๐น๐๐ฎ๐๐, ๐ฎ๐ป๐ฑ ๐ฐ๐ผ-๐น๐ผ๐ฎ๐ฑ๐ฒ๐ฟ๐. However, the startup๐ฟ๐ฒ๐บ๐ฎ๐ถ๐ป๐ ๐ฟ๐ฒ๐๐ฝ๐ผ๐ป๐๐ถ๐ฏ๐น๐ฒ ๐ณ๐ผ๐ฟ ๐ฑ๐ฒ๐น๐ฎ๐๐ ๐ผ๐ฟ ๐ฑ๐ฎ๐บ๐ฎ๐ด๐ฒ๐.
Should GST be charged ๐๐ฒ๐ฝ๐ฎ๐ฟ๐ฎ๐๐ฒ๐น๐ for road and rail? Or is it a ๐ฐ๐ผ๐บ๐ฝ๐ผ๐๐ถ๐๐ฒ ๐๐๐ฝ๐ฝ๐น๐?
๐ ๐๐ฒ๐ฟ๐ฒโ๐ ๐๐ต๐ฒ ๐ฐ๐น๐ฎ๐ฟ๐ถ๐๐:
โ
๐ ๐๐น๐๐ถ๐บ๐ผ๐ฑ๐ฎ๐น ๐ง๐ฟ๐ฎ๐ป๐๐ฝ๐ผ๐ฟ๐ ๐ฆ๐ฒ๐ฟ๐๐ถ๐ฐ๐ฒ๐ (๐ฆ๐๐ 996541) ๐ฎ๐๐๐ฟ๐ฎ๐ฐ๐ 12% ๐๐ฆ๐ง ๐๐ป๐ฑ๐ฒ๐ฟ ๐ณ๐ผ๐ฟ๐๐ฎ๐ฟ๐ฑ ๐ฐ๐ต๐ฎ๐ฟ๐ด๐ฒ.
โ
This was introduced in 2018 to simplify taxation for logistics using multiple transport modes.
๐ In the 28๐๐ต ๐๐ฆ๐ง ๐๐ผ๐๐ป๐ฐ๐ถ๐น ๐ ๐ฒ๐ฒ๐๐ถ๐ป๐ด (21.07.2018), it was discussed that:
๐กย ๐๐ถ๐ป๐ฑ๐ถ๐ป๐ด ๐ฎ ๐ฑ๐ผ๐บ๐ถ๐ป๐ฎ๐ป๐ ๐๐ฟ๐ฎ๐ป๐๐ฝ๐ผ๐ฟ๐ ๐บ๐ผ๐ฑ๐ฒ ๐ถ๐ ๐๐ฟ๐ถ๐ฐ๐ธ๐
๐ก To๐ฎ๐๐ผ๐ถ๐ฑ ๐ฐ๐ผ๐ป๐ณ๐๐๐ถ๐ผ๐ป, a separate 12% ๐๐ฆ๐ง ๐ฐ๐ฎ๐๐ฒ๐ด๐ผ๐ฟ๐ was introduced.
๐ก This was later notified under:
๐๐ก๐ผ๐๐ถ๐ณ๐ถ๐ฐ๐ฎ๐๐ถ๐ผ๐ป ๐ก๐ผ. 13/2018-๐.๐ง. (๐ฅ๐ฎ๐๐ฒ) & 14/2018-๐.๐ง. (๐ฅ๐ฎ๐๐ฒ) (26.07.2018)
๐จ๐๐ฒ๐ ๐ฅ๐ถ๐๐ธ๐ ๐ณ๐ผ๐ฟ ๐ฆ๐๐ฎ๐ฟ๐๐๐ฝ๐:
โ ๏ธ ย GST authorities may still argue that ๐บ๐๐น๐๐ถ๐บ๐ผ๐ฑ๐ฎ๐น ๐๐ฟ๐ฎ๐ป๐๐ฝ๐ผ๐ฟ๐
๐ is ๐ฎ ๐ฐ๐ผ๐๐ฟ๐ถ๐ฒ๐ฟ ๐๐ฒ๐ฟ๐๐ถ๐ฐ๐ฒ chargeable to GST at 18%. But the ๐๐๐๐ ๐๐ถ๐ฟ๐ฐ๐๐น๐ฎ๐ฟ ๐ก๐ผ. 104/7/2008-๐ฆ.๐ง clarified that ๐บ๐๐น๐๐ถ๐บ๐ผ๐ฑ๐ฎ๐น ๐๐ฟ๐ฎ๐ป๐๐ฝ๐ผ๐ฟ๐ ๐ถ๐ ๐ก๐ข๐ง ๐ฐ๐ผ๐๐ฟ๐ถ๐ฒ๐ฟ ๐๐ฒ๐ฟ๐๐ถ๐ฐ๐ฒ. โ
๐ is chargeable to GST at 18% as any other service โ which can be negated based on the aforementioned clarification on ๐ ๐๐น๐๐ถ๐บ๐ผ๐ฑ๐ฎ๐น ๐ง๐ฟ๐ฎ๐ป๐๐ฝ๐ผ๐ฟ๐ ๐ฆ๐ฒ๐ฟ๐๐ถ๐ฐ๐ฒ๐
๐ก Why do these matters for your startup? Correct GST classification
โ
๐ฟ๐ฒ๐ฑ๐๐ฐ๐ฒ๐ ๐๐ฎ๐
๐ฟ๐ถ๐๐ธ๐
โ
ensure less or no haircut to your valuation in the next funding round
โ
๐ฒ๐ป๐๐๐ฟ๐ฒ๐ ๐๐บ๐ผ๐ผ๐๐ต ๐ณ๐๐ป๐ฑ๐ถ๐ป๐ด
Has GST ever impacted your startupโs operations or funding?
โ๏ธLogistics Businesses: Are you charging the right GST? ๐๐
Pradeep Reddy Unnathi Partners
Logistics Businesses Must Apply 12% GST for Multi-Mode Transport to Avoid Disputes and Financial Penalties The article discusses the importance of correctly charging Goods and Services Tax (GST) for logistics businesses, particularly those using multiple modes of transport such as road, rail, or air. It highlights a specific GST rate of 12% introduced in 2018 to simplify taxation for logistics involving multiple transport modes. The article also notes potential disputes with GST authorities, who may argue for an 18% rate, but clarifies that the 12% rate applies based on existing guidelines. Accurate GST classification is crucial for startups to avoid financial penalties and maintain their valuation during funding rounds. (AI Summary)