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RCM FOR FREIGHT

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This query is : Resolved

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GST freight exemption limits of 750/1,500 are removed via Notification 04/2022. Now all GTA services are taxable. GST applies under RCM @5% (no ITC) if GTA doesn't opt for forward charge, or 5%/12% under forward charge.

CA Nidhi Kanabar

CA Nidhi Kanabar (Querist)
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19 December 2024 HI
RCM on freight limit of Rs.750 or 1500 is still exist or it has been removed under GST
If there is any change in limit then please share notification

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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19 December 2024 The exemption thresholds of INR 750 and INR 1,500 were scrapped as per Notification No. 04/2022-Central Tax (Rate) dated July 13, 2022. This means all freight charges are now taxable regardless of their amount. This means any value of supplies made by a GTA will be subject to taxation under either the forward charge or reverse charge mechanism. GTAs now have the option to charge GST at 5% without Input Tax Credit (ITC) or 12% with ITC.
If GTA does not opt for the forward charge mechanism, the recipient of the service must pay GST under RCM at a rate of 5%/

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