Exemption to Sub Contractor

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This query is : Resolved

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This discussion clarifies that subcontractors providing services to main contractors, even those working for government entities, are generally not exempt from GST. The main contractor must issue a tax invoice with GST to the government, and the subcontractor must issue a tax invoice with GST to the main contractor. The main contractor can then claim Input Tax Credit (ITC) for the GST paid to the subcontractor.

HITENDRA PAWAR

HITENDRA PAWAR (Querist)
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26 August 2020 Whether Subcontractor providing services to the main contractor (Who is in contract with Govt entities and charges 12% GST to Govt.) is exempt from GST???

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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26 August 2020 Not exempt from GST.

HITENDRA PAWAR

HITENDRA PAWAR (Querist)
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30 August 2020 What if there is a contract between Main contractor and Sub Contractor, where main contractor appoint subcontractor to complete whole of the work by Subcontractor. Then can we say that GST paid by the main contractor is ultimately paid by the subcontractor... as whole of the work is done by subcontractor.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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31 August 2020 Subcontractors has to raise tax invoice with GST to main contractor. Main contractor has to raise tax invoice and pay GST after claiming ITC (reduce tax paid by sub contractor).

HITENDRA PAWAR

HITENDRA PAWAR (Querist)
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03 September 2020 Really appreciate sir. Thank you so much for your guidance.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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03 September 2020 You are welcome.........

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