RCM ON FREIGHT

[Deepak Garg]

SIR,

I AM PURCHASING POULTRY FEED AND PAID FREIGHT. WHEATHER I AM LIABLE TO PAY GST UNDER RCM @ 5% ON PAYMENT OF FREIGHT. THE COMMODITY IS TAX FREE.

[Ganeshan Kalyani]

GST is payable on the freight amount paid by you.

[Deepak Garg]

SIR, CAN WE CLAIM TAX PAID ON FREIGHT AS ITC

[CASusheel Gupta]

ITC of freight is allowed

Regards

CA Susheel Gupta

8510081001, 9811004443

[Ganeshan Kalyani]

Yes , you can take credit of the tax paid in the same month .

[Ganeshan Kalyani]

Subject to the condition that final product is taxable. As you said you are dealing in poultry feed which is exempt in GST input tax credit of the GST paid on GTA is not eligible.

[Ganeshan Kalyani]

Poultry feed falls under HSN 2309.

[Padmanathan KV]

YOU ARE LIABLE TO PAY GST ON RCM ONLY IF FREIGHT IS PAID TO GTA. IF THE TRANSPORTER IS NOT A GTA, THERE IS NO LIABILITY TO PAY GST ON RCM

AI Summary

Reverse charge on freight applies when paid to a Goods Transport Agency, affecting ITC entitlement for exempt supplies.
GST on freight is payable under the Reverse Charge Mechanism when freight is paid to a Goods Transport Agency; RCM does not apply if the transporter is not a GTA. Input tax credit for GST paid on freight is admissible only when the recipient's outward supplies are taxable; where the final goods are exempt (e.g., poultry feed under HSN classification), ITC on freight/GTA services is not available.