RCM on supply from unregistered person, Goods and Services Tax - GST

[venkataraman swaminathan]

Dear Sir

Good Morning

As per the Notification dt. 29.1.2019 , we.f. 1.2.2019 RCM GST liability , on purchases/ Services from Unregistered persons are waived up to 30.9.2019. Now is it applicable to pay under RCM from URD ,w.e.f. 01.10.2019. for the specified goods & services. Request guidance on this please.

Thanking you

V Swaminathan

[Shilpi Jain]

There is an amendment to the section 5(4) of IGST Act and 9(4) of the CGST Act as per which only notified supplies in respect of notified class of persons would be liable when procurred from unregistered persons. Hence, except for the notified supplies (eg: in case of real estate service suppliers paying @ 5%) there would be no liability of GST on procurements from URP.

[Ganeshan Kalyani]

The previous provision where purchase from any unregistered person by a registered person need to pay tax under rcm by recipient is rescinded.

AI Summary

Reverse Charge Mechanism limited to notified supplies from unregistered persons; general recipient liability for such purchases removed.
Reverse charge liability for supplies procured from unregistered persons is restricted so that only notified supplies procured from specified classes of persons attract GST on the recipient; ordinary procurements from unregistered persons no longer attract recipient-side reverse charge except where the supply is specifically notified.