is RCM payable on GTA service if freight charges including in Invoice and tax charge on the rate which applicable on original item i.e. 18% and same amount paid to GTA

[Gaurav Goyal]

Dear Sir/Madam,

We charged freight charges on invoice and calculate GST on same rate as applicable on goods. But same amount of freight paid to GTA. Is GST to be paid on RCM also.?

Example:

Value of Goods 90000/-

Freight charges 10000/-

Taxable value 100000/-

GST@18% 18000/-

Total Invoice value 118000

Now we paid 10000 to GTA and my Freight account shown in Profit and loss account as 0/-(10000 Dr-10000 Cr).

Is RCM applicable on payment to GTA of 10000/-

Thanking you

AI Summary

Reverse Charge Mechanism (RCM) applies 5% GST on GTA freight; claim refund for excess 18% GST paid. A query was raised regarding the applicability of Reverse Charge Mechanism (RCM) on freight charges included in an invoice for goods, taxed at 18%. The freight paid to a Goods Transport Agency (GTA) was 10,000. Multiple responses clarified that GST under RCM at 5% is applicable on the 10,000 paid to the GTA, assuming the transporter qualifies as a GTA. If GST was already charged at 18% on the total invoice, the excess GST paid can be claimed as a refund. It was emphasized that GST under RCM must be paid in cash, and any excess payment should be reclaimed.