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commission paid is RCM applicable under GST, Goods and Services Tax - GST

Issue Id: - 118433
Dated: 20-3-2023
By:- mandar yadav
commission paid is RCM applicable under GST

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We are Pvt. ltd company & we have Regd. GST no. we have paid commission to Unregistratate person regarding we get business from him & we directly sold our goods to third party now our question is that should we pay GST under RCM for commission paid to Unregistratate person for his giving business to us. if yes or no then please provide notification ,section,rule which is helpful to us when assesment

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1 Dated: 20-3-2023
By:- Padmanathan Kollengode


No, RCM is not required to be paid on commission paid to unregistered person. There are two provisions which provide for RCM under GST namely, Sec. 9(3) & Sec. 9(4).

Sec 9(3) provides for RCM on notified goods or services. As such, Notification No. 4/2017 CT-R and No. 13/2017 CT-R respectively provides for the goods and services on which RCM is applicable. The service provided by agent to principle for getting customers is not included in the said Notification. (although Insurance agent, recovery agent, Business Facilitator & Business Correspondent etc are included).

Section 9(4) provided for RCM on supply received from unregistered person. However RCM was absolutely exempted with effect from 13-10-2017 vide Notification 8/2017 amended by 13/2017. Later Section 9(4) itself has been amended with effect from 1-2-2019 by CGST ( Amendment) Act, 2018. Currently, Sec 9(4) applies only to Real estate promoters.

2 Dated: 23-3-2023

Intermediary services are not covered under RCM. I concur with the views of Sh.Padmanathan Kollengode. Nicely explained.

Page: 1

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