Reverse Charge Mechanism (RCM) on renting of motor vehicles

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....ommissioner of State Tax/ Assistant Commissioner of State Tax (CDC)/ Superintendent of State Tax (All)/ Inspector of State Tax (All) Subject- Reverse Charge Mechanism (RCM) on renting of motor vehicles -reg. The Department of' Revenue, 'Tax Research Unit vide Circular No. 130/49/2019-GST dated 31 December, 2019 has issued a clarification regarding Reverse Charge Mechanism (RCM) on renting of ....

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....rch Unit) North Block, New Delhi, Dated the 31st December, 2019 To, The Principal Chief Commissioners/ Chief Commissioners/ Principal Commissioners/ Commissioner of Central Tax (All) / The Principal Director Generals/ Director Generals (All) Madam/Sir, Subject- Reverse Charge Mechanism (RCM) on renting of motor vehicles -reg. Suppliers of service by way of renting of any motor vehicle ....

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.... Category of Supply of Services Supplier of service Recipient of Service (1) (2) (3) (4) 15 Services provided by way of renting of a motor vehicle provided to a body corporate. Any person other than a body corporate, paying central tax at the rate of 2.5% on renting of motor vehicles with input tax credit only of input service in the same line of business Any body corporate located in t....

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.... is not absurd would be that - (i) where the supplier of the service charges GST @ 12% from the service recipient, the service recipient shall not be liable to pay GST under RCM; and, (ii) where the supplier of the service doesn't charge GST @ 12% from the service recipient, the service recipient shall be liable to pay GST under RCM. 5. Though a supplier providing the service to a body corpor....