CA. Bhavik P. Chudasama
Quick Summary
The Reverse Charge Mechanism (RCM) is a crucial aspect of the Goods and Services Tax (GST) framework in India, shifting the tax liability from the supplier to the recipient of goods and services. This document provides a summarized overview of the RCM provisions, outlining the applicable goods and s
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FAQ :
The Reverse Charge Mechanism (RCM) under GST is a system that transfers the liability to pay tax from the supplier of goods or services to the recipient of those goods or services.
For cashew nuts (not shelled or peeled), bidi wrapper leaves, and tobacco leaves, the liability to pay GST under RCM falls on the registered person who receives these goods from an agriculturist.
For services provided by a Goods Transport Agency (GTA) for transportation of goods, the recipient has the option to pay GST at 5% without Input Tax Credit (ITC) or 12% with ITC.
A business entity located in a taxable territory must pay GST on legal services provided by an individual advocate, senior advocate, or firm of advocates under RCM.
No, RCM applies to specific services provided by the Central or State Government, Union Territory, or local authority to a business entity, excluding certain services.
It is strongly recommended to refer to the latest notifications and updates on the Central Board of Indirect Taxes and Customs (CBIC) Portal for the most current and accurate RCM information.
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