gst on freight under RCM

[Kavali Ramanjeneyulu]

A taxpayer is paying gst @5% on freight under RCM in terms of Notfn no. 13/2017-CT dt 28.06.2017. As per Notfn No. 11/2017-CT dt 28.06.2017 (s.ni. 9), rate of tax @5% in respect of GTA is applicable provided the credit of input tax charged on goods and services used in supplying the service. In this case, the queries are put forth for clarification pl.

How to ascertain whether the supplier has taken credit on the goods and services used in supplying the service

Is there any requirement of giving declaration by the GTA regarding non availement of ITC on goods and services used in supplying service

If the supplier has taken credit on the goods and services used in supplying the service, whether the recipient is eligible for concessional rate of 5% tax or he has to pay tax @18%.

AI Summary

GTA tax option: choose forward charge with input tax credit or reverse charge without credit, affecting recipient liability.
A goods transport agency must elect at the start of the financial year to either operate under forward charge with input tax credit or to supply without claiming input tax credit under the reverse charge mechanism; hybrid treatment is prohibited. If reverse charge applies, the recipient bears the tax liability and may claim input tax credit subject to cash payment and ordinary ITC conditions. No separate declaration by the GTA is required, though invoices commonly state that GST is payable under RCM.