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Issue ID : 115228
- 0 -

GST on Freight

Date 23 Jul 2019
Replies6 Answers
Views 2116 Views
Asked By

Hello Sir, Mr X is purchasing Goods from Mr. A which is Shipped to Mr. Z. Mr X pays the Freight.The sale price Quoted to Mr. Z is inclusive of freight.

My Query is that

is Mr X liable to Pay RCM on Freight (Although he is Paying GST on Sale which is Inclusive of freight)

6 answers
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Old Query - New Comments are closed.

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- 0
Replied on Jul 23, 2019
1.

No double taxation is required by GST law or any other law. What is the GST rate of goods supplied by A to X ?

- 0
Replied on Jul 25, 2019
2.

They are two separate transaction. If transporter raised invoice on you then you have to pay tax under RCM. The freight component which you add in your customer billing is to recover that freight cost. The tax which is paid under RCM on freight can be claimed as credit to offset against the tax payable on outward supply.

- 0
Replied on Jul 26, 2019
3.

Dear Sir, as you said the freight component which you add in your customer billing is to recover that freight cost but i have to Charge GST on that Freight Amt being Composite Supply.and i have to pay under RCM Also

- 0
Replied on Jul 26, 2019
4.

As explained by Ganeshan Kalyaniji is correct

There are two transactions

first when X is purchasing goods and engages a transporter and pays to transporter then X has to pay GST on reverse charge being services availed from GTA and take credit of RCM paid

Second transaction when X recovers the Freight on sale from Z, X has to charge the GST on entire value ( goods + freight) and rate of gst is as applicable to the HSN code of goods supplied.

- 0
Replied on Jul 27, 2019
5.

I re-read query and replies. I agree with both Sh.Ganeshan Kalyani Ji and Sh. Madhavan Iyengar Ji. Well elaborated by Sh.Madhavan Ji. I think the querist is not under doubt now.

- 0
Replied on Jul 27, 2019
6.

thank u kasturi sir for your kind words

Old Query - New Comments are closed.

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