RCM on Commercial Godown

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This query is : Resolved

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This discussion clarifies the applicability of Reverse Charge Mechanism (RCM) for Goods Transport Agencies (GTAs) renting commercial godowns from unregistered persons, particularly from October 2024. While GTAs are registered for GST, their outward supplies are taxable under RCM. The consensus is that RCM is applicable to the GTA for inward supplies like godown rent, meaning the GTA must pay the GST. However, the GTA cannot claim Input Tax Credit (ITC) for this RCM payment as their outward supplies are not covered under Forward Charge Mechanism (FCM).

nitin gulati

nitin gulati (Querist)

19 February 2025 Sir
On GTA services tax under RCM paid by recipients and not by GTA. As GTA is already registered under GST will it require to pay tax under RCM for commercial godown taken on rent from unregistered person(From Oct 2024).
Or
As GTA not required to pay tax on his O/W supply no need to pay GST on Rent as per RCM new RCM entry 5AB.
and GST if paid is burden on the GTA.
Pls share expert view Thanks

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

20 February 2025 RCM on rent applicable for registered dealer.

nitin gulati

nitin gulati (Querist)

20 February 2025 Sir in my query GTA is registered in GST but his O/W supply is taxable in hands of recipients.
Share your view.
Thanks

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

20 February 2025 Based on the same data reply has been given above.

CA. Bhavik P. Chudasama

CA. Bhavik P. Chudasama (Expert)

20 February 2025 RCM is to be paid for Inward Supply, so in your case RCM would be applicable.

you will have to Pay RCM but cannot claim ITC as your outward supplier are not covered uner FCM

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