Gst provision on commission
This query is : Resolved
28 November 2018
One of my known one having income from commission. He does not sell on behalf of his principal but acts as an intermediary between both the purchaser and seller. his total commission income is less then 20 lakh whether he is required to registration under GST
30 November 2018
If his commission income does not exceed Rs 20 lakh then GST registration is not compulsory.
02 December 2018
If he is receiving only commission amount in his books of accounts and which is less than Rs.20/- Lakh Per annum, then no GST Registration is required.
04 December 2018
Under compulsory registration requirement which type of commission agent is covered?
19 October 2021
An agent is defined under the GST law as a person who carries on the business of supply of goods or services on behalf of another person (principal). An agent includes broker, commission agent, factor, auctioneer, or a mercantile agent. He carries out activities under the principal-agent relationship.
As per Section 7 of the CGST Act read with the Schedule I, ‘Supply of goods, by a principal to his agent or by an agent to his principal, where the agent supplies such goods on behalf of the principal’ is chargeable to GST even if made without consideration, but for conducting business. Thus, a principal-agent relationship is an essential factor for determining whether a transaction is covered under the definition of an agent.
Any person who falls under the definition of an agent is required to obtain GST registration. The threshold limit condition for registration does not apply to commission agents. So, a person is required to obtain compulsory registration once he falls under the definition of an agent as mentioned above.
As per Section 7 of the CGST Act read with the Schedule I, ‘Supply of goods, by a principal to his agent or by an agent to his principal, where the agent supplies such goods on behalf of the principal’ is chargeable to GST even if made without consideration, but for conducting business. Thus, a principal-agent relationship is an essential factor for determining whether a transaction is covered under the definition of an agent.
Any person who falls under the definition of an agent is required to obtain GST registration. The threshold limit condition for registration does not apply to commission agents. So, a person is required to obtain compulsory registration once he falls under the definition of an agent as mentioned above.
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