Tax
This query is : Resolved
22 August 2017
sir, we are selling exempted products, but we have taken gst regestration because we are purchasing goods from out of state suppliers. if we purchased goods from unregistered we have to pay tax under RCM? and also if we paid hamali charges, rent (expenses) we have to pay tax under RCM. please clarify
22 August 2017
Since you are registered, inward supply from an unregistered dealer will be liable to reverse charge.
22 August 2017
Thanks u sir
22 August 2017
Cam we claim input on this RCM. Ours sales is exempt
22 August 2017
If , how can we claim
22 August 2017
We have to pay tax under RCM for transport charges of inward supplies , if yes how much percentage and how to claim , and thr is no tax on our outward supplies
26 July 2025
Here’s a clear breakdown for your GST RCM (Reverse Charge Mechanism) query:
### 1. **Purchase from Unregistered Supplier (Inward Supply)**
* Since you are **GST registered**, if you purchase goods or services from an **unregistered supplier from another state**, **you must pay GST under Reverse Charge Mechanism (RCM)**.
* You will have to calculate and pay the applicable GST (CGST+SGST or IGST) on such inward supplies.
### 2. **Input Tax Credit (ITC) on RCM**
* If your **outward supplies are fully exempt**, **you cannot claim Input Tax Credit** on GST paid under RCM.
* Because ITC is only available for taxable supplies, and exempt sales block ITC.
### 3. **Expenses like Hamali Charges, Rent, Transport Charges**
* If these are considered **services from unregistered suppliers**, GST under RCM is applicable if the services fall under notified categories (like goods transport services by road, renting of goods, etc.).
* For transport charges on inward supplies, GST is payable under RCM at **5% (2.5% CGST + 2.5% SGST) or 12% IGST**, depending on whether it is intra or interstate.
* However, since your **sales are exempt**, you **cannot claim ITC** on GST paid on these expenses under RCM.
### Summary:
| Scenario | RCM Applicable? | Can Claim ITC? |
| -------------------------------------------- | ------------------------ | --------------------------- |
| Purchase from unregistered dealer (goods) | Yes | No, if outward sales exempt |
| Hamali/transport charges (unregistered) | Yes, if notified service | No, if outward sales exempt |
| Rent (if from unregistered service provider) | Yes, if notified service | No, if outward sales exempt |
---
**Note:** It is important to check if your rent/hamali/transport services are specifically notified under RCM rules. Also, consult a GST practitioner for specifics based on your exact business setup.
If you want, I can help you with the exact GST rates or notify categories under RCM. Would you like that?
### 1. **Purchase from Unregistered Supplier (Inward Supply)**
* Since you are **GST registered**, if you purchase goods or services from an **unregistered supplier from another state**, **you must pay GST under Reverse Charge Mechanism (RCM)**.
* You will have to calculate and pay the applicable GST (CGST+SGST or IGST) on such inward supplies.
### 2. **Input Tax Credit (ITC) on RCM**
* If your **outward supplies are fully exempt**, **you cannot claim Input Tax Credit** on GST paid under RCM.
* Because ITC is only available for taxable supplies, and exempt sales block ITC.
### 3. **Expenses like Hamali Charges, Rent, Transport Charges**
* If these are considered **services from unregistered suppliers**, GST under RCM is applicable if the services fall under notified categories (like goods transport services by road, renting of goods, etc.).
* For transport charges on inward supplies, GST is payable under RCM at **5% (2.5% CGST + 2.5% SGST) or 12% IGST**, depending on whether it is intra or interstate.
* However, since your **sales are exempt**, you **cannot claim ITC** on GST paid on these expenses under RCM.
### Summary:
| Scenario | RCM Applicable? | Can Claim ITC? |
| -------------------------------------------- | ------------------------ | --------------------------- |
| Purchase from unregistered dealer (goods) | Yes | No, if outward sales exempt |
| Hamali/transport charges (unregistered) | Yes, if notified service | No, if outward sales exempt |
| Rent (if from unregistered service provider) | Yes, if notified service | No, if outward sales exempt |
---
**Note:** It is important to check if your rent/hamali/transport services are specifically notified under RCM rules. Also, consult a GST practitioner for specifics based on your exact business setup.
If you want, I can help you with the exact GST rates or notify categories under RCM. Would you like that?
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