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Non Taxable Supply vs Non GST Supply, Goods and Services Tax - GST
|Non Taxable Supply vs Non GST Supply|
The definition of exempt supply u/s 2(47) of CGST Act includes Non Taxable Supply. Does the term "non taxable supply" is equivalent to "Non-GST supply" as per table 3.1.e of Form GSTR-3B & Table -8 of GSTR-1?
If yes. Whether ITC reversal u/r 42 needs to be computed on total of (exempt supply + non gst supply )?
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What is cause of 'reimbursement'? Is it recovery as 'pure agent' referred u/s 33?
Please reads as .......... u/r 33
Dear Amit Ji,
Yes. the reimbursements are amount recovered from customer as pure agent, as certain expense are incurred on behalf of customer, which is shown in invoice.
There is a lot of difference between 'non-taxable supply' and 'non-GST Supply'. Non-GST supply means out of the scope of GST i.e. petrol, diesel, LPG , liquor etc.
Section 2 (47) of CGST Act “exempt supply” means supply of any goods or services or both which attracts nil rate of tax or which may be wholly exempt from tax under section 11, or under section 6 of the Integrated Goods and Services Tax Act, and includes non-taxable supply;
Exempt supply includes non-taxable but does not include non-GST supply.
Accordingly, same cannot be equated with non-taxable supply or non-GST supply and you should not show them as Non-GST supply in Form GSTR-3B.
P.S. Ideally, such reimbursements should not be part of your turnover in your books of accounts, but same should be adjusted / knocked off against corresponding expenses incurred by you on behalf of client.
These are ex facie views of mine and the same should not be construed as professional advice / suggestion.
I fully agree with Sh.Amit Agrawal Ji.
The querist must be able to differentiate between 'disbursement' and 'reimbursement' with documentary evidence.
Illustration in Rule 33 talks of disbursement. So one has to be careful.
Agree that pure agent reimbursements are not part of turnover/taxable value i.e. aggregate turnover, So no ITC reversal required.
Reimbursement as a pure agent is excluded from the value of supply. hence it shouldn't be disclosed as non taxable supply in R1/R3B.
If it is for FY 22-23, kindly amend R1 and rectify in R9 as well.