RCM ON FREIGHT (Tranpostation charges)

[SURYAKANT MITHBAVKAR]

Local transporter who is registered and unregistered under GST not charging any GST in their bill.

Is there any liability to us to pay GST under RCM. But RCM is exempted till June-18.

[Rajagopalan Ranganathan]

Sir,

Under Section 9 (3) of CGST Act, 2017 " the Government may, on the recommendations of the Council, by notification, specify categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both.

As per notification No. 8/2017-Central Tax (Rate) dated the 28th June, 2017as amended the exemption contained there in is extended up to 30.6.2018. This Notification exempts payment of tax under RCM under Section 9 (4) of CGST Act, 2017.

Payment of gst under reverse charge on transportation service provided by GTA is covered by Section 9 (3) of CGST Act, 2017 read with Sl. No. 1 of Notification No. Notification No. 13/2017- Central Tax (Rate) dated 28.6.2017 as amended.

[CASusheel Gupta]

There are two sections of RCM

Section 9(3) - which requires payment on RCM on transportation charges. etc.

Section 9(4) - which requires payment on RCM on purchases from unregistered suppliers

Section 9(4) has been deferred till 30.06.2018. But u need to pay GST on transportation charges under section 9(3).

Regards

CA Susheel Gupta

9811004443, 8510081001

[KASTURI SETHI]

I support the views of both experts.

[Ganeshan Kalyani]

Yes reverse charge on GTA, legal service is still there. But reverse payable under reverse on account of purchase from an unregistered dealer is exempted till 30.06.2018.

[Ganeshan Kalyani]

As per latest update, reverse charge in case of purchase from an unregistered dealer is discussed to bring in to force is month of may 2018.

AI Summary

Reverse charge on transportation services requires recipient payment, while RCM for purchases from unregistered suppliers remains deferred. Liability under the reverse charge mechanism for transportation services rests with the recipient, while the reverse charge obligation for purchases from unregistered suppliers has been exempted/deferred by notification and is not presently applicable.