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What expenses are liable for a reverse charge under the GST?

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What expenses are liable for a reverse charge under the GST?
posted Feb 9, 2018 by Sagar Sharma

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1 Answer

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Normally

(i) When a registered dealer receive a supply of goods or services or both from an unregistered dealer for more than 5000/- per day then he has to pay GST under Reverse Charge Mechanism.

(ii) The government has notified some goods or services on which reverse charge will be applicable irrespective of the limit of Rs. 5000/- per day.

Supply on which Reverse charge will be applicable

(a) Service provided by Goods Transport Agency to notified category of receiver (such as- casual taxable person, Body corporate etc.) Service recipient will be liable for GST

(b) Service provided by recovery agent to banking company and NBFC, the recipient will be liable to pay GST.

(c) Service provided by director or company or body corporate to company or body corporate

(d) Service Provided by insurance agent to any person carrying on insurance business

(e) Sponsorship services provided by any person to anybody corporate or partnership firm

(f) Service provided by a person located in Non-taxable territory to a person located in Taxable Territory

(g)A taxi driver or Rent a cab operator (if service provided by e-commerce operator) to any person.

All above are some specific cases in which Reverse charge will be applicable.

answer Feb 12, 2018 by Ati Kumar
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