TaxTMI 
TaxTMI 
My friends company is paying commission to their Non- Executive directors. They provided commission entry in books in FY 2020-21, the same got approved in Board meeting which is held in July-2021 & payment was made to director on 7th Aug 2021. Company Paid GST on RCM on 20th Sept 2021. Now Government GST officer raise the query that the company has paid the GST on RCM in Sept-2021, which is liable for interest for delay payment of GST. We would like to know the legal provision of the act. Whether RCM is to be paid on Provision or on Actual payment basis.
RCM on Non -executive director Commission
18 Oct 2022 
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Time of supply for reverse charge: payment date or statutory follow-up period determines GST liability and interest exposure.
GST under the reverse charge mechanism on director commission becomes payable based on the statutory time of supply: the earlier of the payment date (as entered in books or debited to bank) or the date following the statutory period after invoice. The CGST definition of consideration treats payments made or to be made as taxable; consequently GST remitted after the operative time of supply can attract interest for delayed payment. (AI Summary)
GST under the reverse charge mechanism on director commission becomes payable based on the statutory time of supply: the earlier of the payment date (as entered in books or debited to bank) or the date following the statutory period after invoice. The CGST definition of consideration treats payments made or to be made as taxable; consequently GST remitted after the operative time of supply can attract interest for delayed payment. (AI Summary)