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Revese Charge Mechanism

rejeesh (student) (22 Points)

08 October 2017

effective date of 22 GST Council decision

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6 Replies

g mahesh Mundra (Business and tax consultant) (3293 Points)
Replied 08 October 2017

from 06/10/17

Baldev Prajapati (264 Points)
Replied 08 October 2017

but no official notification regarding that so that means wait for it.

g mahesh Mundra (Business and tax consultant) (3293 Points)
Replied 08 October 2017

PRESS RELEASE
6
th October, 2017
Recommendations made by the GST Council in the 22nd meeting at New Delhi on 6th
October, 2017
GST package for Small Units
The GST Council, in its 22nd meeting held at New Delhi on 6th October 2017, has recommended the
following facilitative changes to ease the burden of compliance on small and medium businesses:
Composition Scheme
1. The composition scheme shall be made available to taxpayers having annual aggregate turnover of up to
Rs. 1 crore as compared to the current turnover threshold of Rs. 75 lacs. This threshold of turnover for
special category States, except Jammu & Kashmir and Uttarakhand, shall be increased to Rs. 75 lacs
from Rs. 50 lacs. The turnover threshold for Jammu & Kashmir and Uttarakhand shall be Rs. 1 crore.
The facility of availing composition under the increased threshold shall be available to both migrated
and new taxpayers up to 31.03.2018. The option once exercised shall become operational from the first
day of the month immediately succeeding the month in which the option to avail the composition
scheme is exercised. New entrants to this scheme shall have to file the return in FORM GSTR-4 only for
that portion of the quarter from when the scheme becomes operational and shall file returns as a normal
taxpayer for the preceding tax period. The increase in the turnover threshold will make it possible for
greater number of taxpayers to avail the benefit of easier compliance under the composition scheme and
is expected to greatly benefit the MSME sector.
2. Persons who are otherwise eligible for composition scheme but are providing any exempt service (such
as extending deposits to banks for which interest is being received) were being considered ineligible for
the said scheme. It has been decided that such persons who are otherwise eligible for availing the
composition scheme and are providing any exempt service, shall be eligible for the composition scheme.
3. A Group of Ministers (GoM) shall be constituted to examine measures to make the composition scheme
more attractive.
Relief for Small and Medium Enterprises
4. Presently, anyone making inter-state taxable supplies, except inter-State job worker, is compulsorily
required to register, irrespective of turnover. It has now been decided to exempt those service providers
whose annual aggregate turnover is less than Rs. 20 lacs (Rs. 10 lacs in special category states except J
& K) from obtaining registration even if they are making inter-State taxable supplies of services. This
measure is expected to significantly reduce the compliance cost of small service providers.
5. To facilitate the ease of payment and return filing for small and medium businesses with annual
aggregate turnover up to Rs. 1.5 crores, it has been decided that such taxpayers shall be required to file
quarterly returns in FORM GSTR-1,2 & 3 and pay taxes only on a quarterly basis, starting from the third

g mahesh Mundra (Business and tax consultant) (3293 Points)
Replied 08 October 2017

of this financial year i.e. October-December, 2017. The registered buyers from such small
taxpayers would be eligible to avail ITC on a monthly basis. The due dates for filing the quarterly
returns for such taxpayers shall be announced in due course. Meanwhile, all taxpayers will be required to
file FORM GSTR-3B on a monthly basis till December, 2017. All taxpayers are also required to file
FORM GSTR-1, 2 & 3 for the months of July, August and September, 2017. Due dates for filing the
returns for the month of July, 2017 have already been announced. The due dates for the months of
August and September, 2017 will be announced in due course.
6. The reverse charge mechanism under sub-section (4) of section 9 of the CGST Act, 2017 and under subsection (4) of section 5 of the IGST Act, 2017 shall be suspended till 31.03.2018 and will be reviewed by
a committee of experts. This will benefit small businesses and substantially reduce compliance costs.
7. The requirement to pay GST on advances received is also proving to be burdensome for small dealers
and manufacturers. In order to mitigate their inconvenience on this account, it has been decided that
taxpayers having annual aggregate turnover up to Rs. 1.5 crores shall not be required to pay GST at the
time of receipt of advances on account of supply of goods. The GST on such supplies shall be payable
only when the supply of goods is made.
8. It has come to light that Goods Transport Agencies (GTAs) are not willing to provide services to
unregistered persons. In order to remove the hardship being faced by small unregistered businesses on
this account, the services provided by a GTA to an unregistered person shall be exempted from GST.
Other Facilitation Measures
9. After assessing the readiness of the trade, industry and Government departments, it has been decided that
registration and operationalization of TDS/TCS provisions shall be postponed till 31.03.2018.
10. The e-way bill system shall be introduced in a staggered manner with effect from 01.01.2018 and shall
be rolled out nationwide with effect from 01.04.2018. This is in order to give trade and industry more
time to acclimatize itself with the GST regime.
11. The last date for filing the return in FORM GSTR-4 by a taxpayer under composition scheme for the
quarter July-September, 2017 shall be extended to 15.11.2017. Also, the last date for filing the return in
FORM GSTR-6 by an input service distributor for the months of July, August and September, 2017 shall