Dear Experts,
I have a query regarding the partial payment disbursement to an MSME vendor. In our organization, we are encountering issues with vendors who are non-filers from a GST perspective. Is it possible to withhold the GST portion while releasing the payment? If so, what are the potential disallowence of doing so?
Regards
JK
Clarification on GST withholding for MSME vendors: Disallowance applies to micro and small enterprises; consider separate account for GST. An individual raised a query regarding the disbursement of partial payments to an MSME vendor who is a non-filer from a GST perspective and whether withholding the GST portion is permissible. A respondent clarified that withholding GST would lead to disallowance under the Act, which includes the GST component in 'any sum payable.' This disallowance applies only to micro and small enterprises. Another respondent suggested that if GST is not reflected on the portal due to non-filing, it might be logical to shift the GST payable to a separate account, potentially reducing disallowance. (AI Summary)
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