Our company had engaged an advocate. As we all know, the services of advocate falls under RCM and therefore our company has to pay GST on it directly to Government. Therefore, the GST will be paid on professional fees charged by advocate under RCM. However, the advocate has also claimed reimbursement of travelling expenses(on actual basis) and clerkage fees (on notional basis i.e 10%).
Question: Whether our company is also liable to pay GST under Reverse charge mechanism on such reimbursements??? Please provide your expert opinion quoting relevant rules and section.
One reimbursement is on actual basis and other is on notional basis. Whether GST applicable on both or only on notional one only. Kindly quote section or rule.
13 February 2018
Naishadh - you can refer Rule 33 of the CGST Rules. It says that the expenditure or costs incurred by the supplier as a pure agent of the recipient of supply shall be excluded from the value of the supply provided the conditions mentioned in Rule 33 are fulfilled.
Therefore, GST shall be applicable only on the notional reimbursement and not on actual reimbursement
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