time of supply for works comtracts

[giri gattupalli]

respected sir what is the time of supply for a govt works contractor for canal work running over one yer

thanking you

[KASTURI SETHI]

Relevant extract of C.B.E. & C. Flyer No. 13, dated 1-1-2018

Invoice in case of continuous supply of services

In case of continuous supply of services, where,

(a) the due date of payment is ascertainable from the contract; the invoice shall be issued on or before the due date of payment;

(b) the due date of payment is not ascertainable from the contract; the invoice shall be issued before or at the time when the supplier of service receives the payment;

(c) the payment is linked to the completion of an event; the invoice shall be issued on or before the date of completion of that event.

Issue of invoice in case, where supply of service ceases under a contract before completion of supply

In a case where the supply of services ceases under a contract before the completion of the supply, the invoice shall be issued at the time when the supply ceases and such invoice shall be issued to the extent of the supply made before such cessation.

[Ganeshan Kalyani]

Advance received towards the service is subject to GST.

[Surabhi Parihar]

In case of continuous supply of services, the time of supply shall be -

(i) Where the due date of payment is ascertainable from the contract: The date on which the payment is liable to be made by the service receiver, whether or not any invoice has been issued or any payment has been received by the supplier of service;

(ii) Where the due date of payment is not ascertainable from the contract: When the supplier of service receives the payment, or issues an invoice, whichever is earlier;

(iii) Where the payment is linked to the completion of an event: The time of completion of that event;

AI Summary

Time of supply for continuous services determines when invoice or payment triggers GST liability and when advances are taxable. The time of supply for continuous works contracts follows three rules: if the due date of payment is ascertainable, the time of supply is the payment due date and the invoice must be issued on or before that date; if the due date is not ascertainable, the time of supply is the earlier of receipt of payment or issuance of an invoice; if payment is linked to completion of an event, the time of supply is the date of completion and the invoice must be issued on or before that date. Advances are taxable on receipt and cessation of supply requires invoicing for the portion supplied.