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RCM in GTA

CA Rashmi Gandhi (Chartered Accountant) (86220 Points)

23 July 2017

Tax paid to GTA under Reverse charge is available as ITC or not.

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16 Replies

pdgoenka (Dy Mgr) (123 Points)
Replied 23 July 2017

ITC available

GST Consultant (Tax Consultant) (894 Points)
Replied 23 July 2017

Available.......

vignesh 0006 (19 Points)
Replied 23 July 2017

yes ITC available

vignesh 0006 (19 Points)
Replied 23 July 2017

yes ITC available

rohit.k.biswakarma@gmail.com (6 Points)
Replied 23 July 2017

deduct 1% tds according to section 194c from my vendors, if the bill exceed 30000 for single or 100000 for aggregate..

after implementation of GST will I have to change the rate or process or something...... Pls clarify....

CA Saloni (Manager-Accounts & GST Consultant) (5124 Points)
Replied 24 July 2017

ITC is available....

Many people are confused because in the rate list, it is written as 5% w/o ITC. But it is for the service provider that he should not have taken the ITC....

For RCM it is definitly 5% RCM with ITC...

alok ranjan (open ) (114 Points)
Replied 24 July 2017

If available then why in GST Rate chart of RCM why is it mentioned that No Input tax credit is allowed. What are the basis that Input tax credit allowed on GTA.

SCHEDULE OF GST RATES FOR SERVICES AS APPROVED BY GST COUNCIL

Services of goods transport agency (GTA) in relation to transportation of goods [other than used household goods for personal use]

Ans: 5% with No ITC

Pls crarify this matter if Itc available on GTA.

CA Saloni (Manager-Accounts & GST Consultant) (5124 Points)
Replied 24 July 2017

Explanation as given in NN-11/2017 - CT(Rate)

(iv) Wherever a rate has been prescribed in this notification subject to the condition that credit of input tax charged on goods or services used in supplying the service has not been taken, it shall mean that,-

(a) credit of input tax charged on goods or services used exclusively in supplying such service has not been taken; and

(b) credit of input tax charged on goods or services used partly for supplying such service and partly for effecting other supplies eligible for input tax credits, is reversed as if supply of such service is an exempt supply and attracts provisions of sub-section (2) of section 17 of the Central Goods and Services Tax Act, 2017 and the rules made

Kaushik Deepak (KD) (Officer Accountant) (1136 Points)
Replied 24 July 2017

NO,

AS PER NOTIFICATION 11/2017

Services of goods transport agency (GTA) in relation to transportation of goods (including used household goods for personal

use) Explanation

“goods transport agency” means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called

Provided that credit of input tax charged on goods and services used in supplying the service has not been taken

pdgoenka (Dy Mgr) (123 Points)
Replied 24 July 2017

Please go through extract of CGST Act Sec 17(5) for better understanding ---

(5) Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input tax credit shall not be available in respect of the following,namely:—

(a) motor vehicles and other conveyances except when they are used––

(i) for making the following taxable supplies, namely:—

(A) further supply of such vehicles or conveyances ; or

(B) transportation of passengers; or

(ii) for transportation of goods;

CA Saloni (Manager-Accounts & GST Consultant) (5124 Points)
Replied 24 July 2017

Originally posted by : pdgoenka
	Please go through extract of CGST Act Sec 17(5) for better understanding --- (5) Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input tax credit shall not be available in respect of the following,namely:— (a) motor vehicles and other conveyances except when they are used–– (i) for making the following taxable supplies, namely:— (A) further supply of such vehicles or conveyances ; or (B) transportation of passengers; or (C) imparting training on driving, flying, navigating such vehicles or conveyances; (ii) for transportation of goods;

This is not better understanding... This is more confusing...

Dhana Sai (234 Points)
Replied 25 July 2017

yes it is available as input

Dhana Sai (234 Points)
Replied 25 July 2017

yes it is available as input

Praneet Kumar (Service (Finance & Account) (24 Points)
Replied 26 July 2017

The schedules for Rate of GST on services is off course for the Taxable Person who provides those services.So in case of GTA , the rate of 5 % without ITC will be applicable when GTA himself charges the GST as a forward charge.In case of reverse charge , there is no restriction of taking credit of the taxes paid subject to the provisions of Sec 17 of the CGST Act 2017.So technically it seems as if the credit is available. But when we read the language of Sec 9 (3) for taxability under RCM , it says that "all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both" Now the question is If all the provisions of the act applies to the recipient of the services /goods then why not this restriction of ITC be on him/her , as the same applies to the service provider?