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TMI BlogReverse Charge Mechanism in GSTX X X X Extracts X X X X X X X X Extracts X X X X ..... ST/SGST (UTGST) Act and section 5 (3) of the IGST Act. Second scenario is covered by section 9 (4) of the CGST/SGST (UTGST) Act and section 5 (4) of the IGST Act where taxable supplies by any unregistered person to a registered person is covered. As per the provisions of section 9(3) of CGST / SGST (UTGST) Act, 2017 / section 5(3)of IGST Act, 2017, the Government may, on the recommendations of the Council, by notification, specify categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ernment entities who are TDS Deductors under Section 51 of CGST Act, 2015, need not pay GST under reverse charge in case of procurements from unregistered suppliers. Registration: A person who is required to pay tax under reverse charge has to compulsorily register under GST and the threshold limit of ₹ 20 lakh (Rs. 10 lakh for special category states except J & K) is not applicable to them. ITC: A supplier cannot take ITC of GST paid on goods or services used to make supplies on which recipient is liable to pay tax. Time of Supply The Time of supply is the point when the supply is liable to GST. One of the factor relevant for determining time of supply is the person who is liable to pay tax. In reverse charge, recipient is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y debiting the electronic cash ledger. In other words, reverse charge liability cannot be discharged by using input tax credit. However, after discharging reverse charge liability, credit of the same can be taken by the recipient, if he is otherwise eligible. 4. Invoice level information in respect of all supplies attracting reverse charge, rate wise, are to be furnished separately in the table 4B of GSTR-1. 5. Advance paid for reverse charge supplies is also leviable to GST. The person making advance payment has to pay tax on reverse charge basis. Supplies of goods under reverse charge mechanism: S/ No. Description of supply of Goods Supplier of goods Recipient of Goods 1 Cashew nuts, not shelled or peeled Agriculturist Any regi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business entity An arbitral tribunal Any business entity located in the taxable territory 5 Services provided by way of sponsorship to any body corporate or partnership firm Any person Any body corporate or partnership firm located in the taxable territory 6 Services supplied by the Central Government, State Government, Union territory or local authority to a business entity excluding, - (1) renting of immovable property, and (2) services specified below- (i) services by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services provided to a person other than Central Government, State Government or Union territory or local authority; (ii) services in relation to an aircraft or a vess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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