Advance received one year back from one scrap merchant and the same has reflected on our books of accounts. Regular basis the scrap merchant taken the scrap and paid the amount of each sales.
My Quarry is Since the advance received before GST, will GST attract for the same or not ??.
Please suggest...
GST Applicability on Scrap Merchant Advance: Invoice Date Determines Tax; Reclassify as Deposit to Avoid GST. A query was raised regarding the applicability of GST on an advance received a year prior from a scrap merchant, which was reflected in the books of accounts. The first response clarified that GST would apply based on the point of taxation, which is the date of the invoice, indicating GST is applicable if the supply occurs after July 1, 2017. Another response suggested reclassifying the amount as a 'deposit' instead of an 'advance' in the accounts, as deposits do not attract GST. The initial responder agreed with this advice and recommended checking any relevant agreements. (AI Summary)
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