RCM FOR URD EXPENSES

[shivashankar mr]

Sir,

may I know the list of expenses. on which expenses RCM is applicable for URD expenses

[KASTURI SETHI]

There is no such list. You will have to go through Section 9(4) of CGST Act along with its history and relevant notifications issued from time to time. Also amended Section 9(4).

[Ganeshan Kalyani]

Sir, please raise your query, we shall reply to it.

[Ganeshan Kalyani]

Sir, GST on URD purchase was between 01.07.2017 to 12.10.2017. Thereafter, some service related to real estate sector was covered under URD RCM.

[Shilpi Jain]

True. In case you are constructing a real estate project and you are under the new scheme wherein your supplies are liable @5%, purchases from unregistered persons in excess of 20% of the total purchases in a FY would be liable under RCM @ 18%.

Apart from this the promoter would be to pay GST on cement purchased from unregistered persons at the applicable rate of GST.

AI Summary

Reverse charge mechanism on unregistered purchases triggers GST liability for recipients under applicable thresholds and rules. Reverse charge liability on supplies from unregistered persons is governed by Section 9(4) of the CGST Act and related notifications; in the real estate context, purchases from unregistered persons exceeding the statutory purchase threshold in a financial year attract RCM at the applicable rate, and promoters must pay GST on construction inputs such as cement procured from unregistered suppliers as specified by law.