Case Study:
Lessor has raised demand note asking lease rental for the whole year.However lessee has moved to court and is not ready to pay any dues.Now in this scenario Lessor is paying GST out of his pocket as no amount is recoverable from the lessee which leading to huge cash blockage at this moment.
Can GST amount be escaped/defered on uncertain revenue and be paid once the revenue becomes certain.
Lessee disputes lease payment; lessor faces cash flow issues due to GST on unpaid rent. Time of supply rule crucial. A lessor raised a demand note for annual lease rental, but the lessee, disputing the payment, moved to court. Consequently, the lessor is paying GST without receiving any payment, causing cash flow issues. The discussion centers on whether GST can be deferred until revenue becomes certain. Responses highlight the importance of the 'time of supply' under GST rules, which generally ties tax liability to the issuance of an invoice or receipt of payment. Some suggest seeking a court order for interim relief on GST payments, while others emphasize the necessity of raising an invoice to trigger tax liability. (AI Summary)
Goods and Services Tax - GST
TaxTMI 
TaxTMI 
TaxTMI 
