What is the limit of RCM on transportation?

What is the limit of RCM on transportation?

Chartered accountant Vikas Goyal said: “The reverse charge mechanism (RCM) on freight is now applicable from even a single rupee, as the exemption of Rs 750 has been abolished from today and, therefore, all consignments for freight worth below Rs 750 and up to Rs 1,500 for single carriage will also be taxable on a par 19-Jul-2022

What is GST rate under RCM?

(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.19-Jul-2022

What is the GST rate on transportation charges?

Moreover, in cases where the service of GTA is availed by the specified categories of persons in the taxable territory, the recipients who avail such services are the ones liable to pay GST and not the supplier of services unless the GTA opts for collecting and paying taxes @ 12% (6% CGST + 6% SGST).

Is RCM payable on transportation charges?

This notification provides that if the goods transport agency opts to pay the tax on forwards charge basis then, such GTA would be liable to pay central tax @ 6% on all the services of GTA (including used household goods for personal use) supplied by it.17-Jul-2019

What is reverse charge transport?

The recipient must be a registered person as per Section 2(94) of the CGST Act,2017. As per section 2(98) of CGST Act 2017, “Reverse-Charge” means the liability to pay tax by the recipient of the supply of goods or services or both instead of the supplier of such goods or services or both.27-Jul-2022

Is GST compulsory for transporter?

Services by way of giving on hire to a goods transport agency, a means of transportation of goods is exempt from GST – Notification No.05-Aug-2020

Is transport exempt from GST?

1. Services related to transportation of goods by road are exempt from tax except the services of GTA (Goods Transport Agency) or Courier Agency. 2. Services related to transportation by way of inland waterways.

Who comes under RCM?

Central Government, State Government, Union territory or local authority Any person registered under the CGST Act, 2017. 6 Services supplied by a director of a company or a body corporate to the said company or the body corporate.

What is the exempt limit of RCM on GTA?

As you will see from the above, there are 2 exemptions - Single carriage Rs. 1,500 and Single consignee Rs. 750. When you avail the services of GTA and assume that GTA is not charging GST on a forward charge basis then as a recipient of service you are required to discharge the GST liability under RCM provisions.31-Jan-2022

How do you calculate RCM?

Example – A trader who is registered in GST takes services of Goods Transport Agency (GTA) for Rs. 10,000. This service is listed under the reverse charge list therefore trader has to pay tax @ 18% on Rs. 10,000 on RCM.

Is RCM applicable on loading and unloading charges?

Sir, Salaries, freight charges, hamuli for loading and unloading charges, interest paid, rent for shop, bank charges. A GST registered person above all expenses paid RCM applicable.

In which case RCM is applicable?

RCM is applicable to a set of supply of goods & services specified by CBIC and to certain situations where the supplier is an unregistered person. RCM is also applicable to supplies that are affected by e-Commerce.

What happens if RCM not paid?

Even if 100% Service Tax is paid to the service provider, the service recipient is liable to pay the service tax under RCM alongwith Interest. If the Department has issued a Show Cause Notice for payment of RCM then the penalty sought is mentioned in the SCN.

On which items RCM is applicable?

Reverse Charge Mechanism (RCM) List under GST

Can we claim refund of RCM paid?

Yes. You can claim refund. See Section 54 (8)(e) of CGST ACT.22-Jan-2022

Can we claim ITC on transportation?

2.1 “As per Section 17(5) of the CGST Act, 2017, input credit can not be availed on Motor vehicles used for transportation of persons having approved seating capacity of not more than 13 persons (including the driver) including leasing, renting or hiring thereof.01-Feb-2022

Is RCM applicable on GTA?

Notification No. 13/2017 – Central Tax (Rate) dated 28/06/2017 clarifies that GST had to be paid under RCM (if GTA not paying under forward charge added vide Notification No. 05/2022 Central Tax Rate w.e.f. 18/07/2022) by the recipient at 5% Rate of Tax. And no ITC was allowed to GTA.04-Aug-2022

Is RCM applicable on transport of exempted goods?

Reverse charge applies only when there is a charge on supply. If supply is exempted, nil rated or non-taxable, RCM does not apply in such a case. Recipient of goods or services discharges GST under RCM as if he is the person liable for paying the tax on supply procured by him.

Is RCM applicable on individual?

1. Any service supplied by any person who is located in a non-taxable territory to any person other than non-taxable online recipient. Any person located in a non-taxable territory Any person located in the taxable territory other than non-taxable online recipient.

Is GST RCM applicable on air freight?

Under GST, the dealers convert logistics and freight forwarding into a supply of services (which includes movement of goods through the sea, inland waterways, air, rail, or road). GST must be charged on the cumulative value of supply.12-Jan-2022

How many types of RCM are there?

RCM Acknowledges Three Types of Maintenance Tasks—These tasks are time-directed (PM), condition-directed (CM), and failure finding (one of several aspects of Proactive Maintenance).09-Nov-2016

What is the limit of RCM on transportation?