Commission business

This query is : Resolved

Paranthaman (Querist)
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26 January 2018 Hi Sir/madam,

What is the impact of gst for Selling goods through commission agents,

For ex: Mr. A is running private limited Company, he selling product for Rs. 1,000 through commission agents and he is paying commission Rs. 3,000. As per this method how he can raise the invoice and which amount should liable for paying GST.

If suppose Mr. A need to pay gst for total amount of Rs. 4,000 inclusive of commission, its incur loss.

Kindly fix the scenario.

CA Suresh Jain

CA Suresh Jain (Expert)
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26 January 2018 If amount billed to the customer is Rs. 4,000.00 you need to pay GST on billed amount. For the amount of commission the commission agent should raise an invoice and charge GST which shall be available to you as ITC.

Paranthaman

Paranthaman (Querist)
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27 January 2018 Thanks for reply...

Sir,

My product value is Rs.1000, As my doubt we need to pay gst for that particular amount right. The remaining Rs.3,000 is commission then why we need pay for the same.

If i paying the gst for full amount including commission, its meet loss to me. How i handle this situation...If there is any provisions. Kindly give me the solution.

CA Suresh Jain

CA Suresh Jain (Expert)
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28 January 2018 On what basis are you paying commission of Rs. 3,000.00 against a sale of Rs. 1,000 only ? Are you selling the product as loss?

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