Reimbursement of Expenses to Pure Agent


This query is : Resolved 

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This discussion clarifies the applicability of Reverse Charge Mechanism (RCM) when a body corporate reimburses a pure agent for Rent-a-Cab services. It confirms that RCM is indeed applicable in this scenario. The reasoning is that the supply of the cab service is considered on a principal-to-principal basis between the body corporate and the cab service provider, making the body corporate liable to pay GST under RCM.

06 January 2020 Whether RCM is applicable if a body corporate pays to its Pure Agent , the amount which has been incurred by the pure agent for Rent a Cab service.

06 January 2020 Yes RCM applicable on it.

06 January 2020 Sir,
RCM is applicable to the body corporate right

06 January 2020 Yes ,RCM is applicable.
When any supply takes place thru pure agent , The relationship between the supplier and recipient with respect to the main service, is on a principal-to-principal basis.
Therefore , GSt applicability between body corporate & cab service provider will be on principal to principal basis and body corporate availing services of cab hire is liable to pay GST on RCM


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