Rcm on goods purchases

Reverse charge, where the recipient is liable to pay tax, is common to many countries like Canada where it is applicable on imports of services and intangible properties. Normally, the supplier pays the tax on supply. In certain cases, the receiver becomes liable to pay the tax, i.e., the chargeability gets reversed which is why it is called reverse charge.

In India, this is a partly new concept introduced under GST.  The purpose of this charge is to increase tax compliance and tax revenues. Earlier, the government was unable to collect service tax from various unorganized sectors like goods transport. Compliances and tax collections will therefore be increased through reverse charge mechanism.

The concept of reverse charge mechanism is already present in service tax. In GST regime, reverse charge may be applicable for both services as well as goods.

Tax paid on reverse charge basis will be available for input tax credit if such goods and/or services are used, or will be used, for business. The service recepient (i.e., who pays reverse tax) can avail input tax credit.

Mr Ramdas Buran, now in GST regime any goods/services which are purchased/received from an unregistered person will attract GST under reverse charge.

As you are the buyer/Service recipient and you are registered, you shall find the HSN/SAC code and tax rates for the goods/services received and shall prepare a payment voucher in respect of each transaction. At the month end you are required to prepare a single tax invoice for all the purchases/services made/received under reverse charge.

Generally whatever tax you paid under reverse charge will be admissible to you as ITC in the subsequent month except some blocked credits which are mentioned in Sec 17(5) and are not admissible.

Thanks a lot for your valuable reply. What is eligibility like in GTA there was limit of Rs.750/- which is same in GST Regime . But what abour purchase of goods from URD ? Can you please explain this ?

Thanks Ma'm...

% of Paying GTA GST and ITC applicability .. Also let me know under which GST is has to be pay CGST,SGST or IGST ? Same for manpower supplier ??