Category: GST

Reverse charge mechanism under GST for supply of goods/services

Reverse charge mechanism under GST. Supply of Goods under RCM and description of nine supply of services covered under RCM-CBEC Paper.

Generally, the supplier of goods or services is liable to pay GST. However, in specified cases like imports and other notified supplies, the liability may be cast on the recipient under the reverse charge mechanism. Reverse charge means the liability to pay tax is on the recipient of supply of goods or services instead of the supplier of such goods or services in respect of notified categories of supply.

There are two type of reverse charge scenarios provided in law. First is dependent on the nature of supply and/or nature of supplier. This scenario is covered by section 9 (3) of the CGST/ 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.

Supplies of goods under reverse charge mechanism:

  • Cashew nuts, not shelled or peeled
  • Bidi wrapper leaves (tendu)
  • Tobacco leaves
  • Supply of lottery
  • Silk yarn

Supplies of services under reverse charge mechanism:

  • GTA Services
  • Legal Services by advocate
  • Services supplied by an arbitral tribunal to a business entity
  • Services provided by way of sponsorship to anybody corporate or partnership firm
  • Services supplied by the Central Government, State Government, Union territory or local authority to a business entity.
  • Services supplied by a director of a company or a body corporate to the said company or the body corporate
  • Services supplied by an insurance agent to any person carrying on insurance business
  • Services supplied by a recovery agent to a banking company or a financial institution or a non-banking financial company.
  • Supply of services by an author, music composer, photographer, artist or the like by way of transfer or permitting the use or enjoyment of a copyright covered under section 13(1)(a) of the Copyright Act, 1957 relating to original literary, dramatic, musical or artistic works to a publisher, music company, producer or the like.

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HSN Smart Search from EZTax

GST for Goods and Services is determined based on the HSN code or SAC code of an item that you are transacting with. As a business owner, Accountant, it’s vital to understand the these codes to record, and file GST returns.

Smart HSN Search

EZTax India developed an intuitive way to find HSN Code for this purpose. Just type a keyword to find the HSN Code, Description, CGST Rate, IGST rates all in one search.

HSN Code Requirement

HSN codes are required while filing your GST returns. EZTax.in/gst will help you in this regard, and below is the basic criteria based on the entities Annual Turnover.

Annual Turnover HSN
Up to 1.5 crore No HSN required
1.5 – 5 crores First 2 digit of the HSN code
More than 5 crores First 4 digit of the HSN Code

Truths about GST

 

All Invoices can be generated manually also, not required to be generated online on Internet.

Internet connection is need only once in a month for filing the Returns.

Provisional Id is the GSTN

New Business Registrations to be done within 30 days.

One Return every month with 3 parts. One is to be filled by the Dealer and the 2 other parts are auto populated.

Small Traders dealing with B2C need to file a Summary of Total Sales

GST rate is higher because previously excise duty and other taxes were not visible, now it is visible.

 

Modes of Verification Under GST Rules .

CBEC, under the exercise of powers conferred upon by sub-Rule 26(1) of the Central Goods and Services Tax Rules 2017, has notified the following modes of verification for the purpose of the said rule:

Aadhaar-based Electronic Verification Code (EVC)

Bank account-based One Time Password (OTP) Provided that where the mode of authentication of any document is through any of the a fore said modes.

Provisional GST number is GSTIN (GST Identification number)

On the registration of businesses, all the subsumed tax assesees, have migrated to the GST Network. Registration, which closed on June 15, will reopen on June 25. The provisional ID number will be the same for GSTIN (GST identification number). New businesses too need not rush. They will have 30 days for GSTIN.

GST- Late Filing Allowed for the 1st 2 months.

Under The GST, the biggest tax reform in India’s history will require firms to file three online returns each month. Some business lobby groups have urged a delay to the rollout to allow more time to get ready.

The government relaxed the filing dates it will allow companies to file late returns for the first two months so that they can adapt to a new online filing system.