rajesh accountant

[rajesh subramanian]

dear sir,

we are paying ₹ 5000 /per month from apr-18 as legal consultancy fee to an individual. whether i have to pay GST under RCM also let me know the paid amt is eligible for taking credit and refund.

Rajesh.S

ETAPL cbe

[KASTURI SETHI]

What is the constitution of your firm ?

[rajesh subramanian]

Respected sir,

We are PVT LTD company

[KASTURI SETHI]

Covered under RCM. You are required to pay GST.

[Alkesh Jani]

Sir,

If the legal consultancy is provided by an "Advocate", RCM is applicable.

Thanks

[KASTURI SETHI]

Yes. Sh.Alkesh Jani Ji is right. Here is relevant extract of C.B.E. & C. Circular No. 27/01/2018-GST, dated 4-1-2018

7.

Whether legal services other than representational services provided by an individual advocate or a senior advocate to a business entity are liable for GST under reverse charge mechanism?

Yes. In case of legal services including representational services provided by an advocate including a senior advocate to a business entity, GST is required to be paid by the recipient of the service under reverse charge mechanism, i.e. the business entity.

[Ganeshan Kalyani]

Legal consultancy is covered under reverse charge only the said service is provided by an advocate, senior advocate or firm of advocate etc.

AI Summary

Reverse charge mechanism for legal services requires the recipient to pay GST when supplied by an advocate. Reverse Charge Mechanism applies to legal services supplied by an advocate, including senior advocates, to a business entity; the recipient business is required to pay GST under RCM. The document clarifies that legal consultancy attracts RCM only when the supplier is an advocate, senior advocate, or advocate firm. Queries on input tax credit or refund were raised but the responses concentrate on recipient liability under RCM as per the cited revenue circular.