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GST RCM Final Version

The Reverse Charge Mechanism (RCM) in GST shifts the tax liability from the supplier to the recipient for certain specified categories of goods and services. Key scenarios include services from unregistered suppliers to registered recipients, and specific services such as legal, security, and sponsorship services. The document outlines various categories and conditions under which RCM applies, including transactions involving individuals, businesses, and government entities.

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Muskaan Aggarwal
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3 views22 pages

GST RCM Final Version

The Reverse Charge Mechanism (RCM) in GST shifts the tax liability from the supplier to the recipient for certain specified categories of goods and services. Key scenarios include services from unregistered suppliers to registered recipients, and specific services such as legal, security, and sponsorship services. The document outlines various categories and conditions under which RCM applies, including transactions involving individuals, businesses, and government entities.

Uploaded by

Muskaan Aggarwal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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REVERSE CHARGE MECHANISM IN

GST
B y M u s ka a n A g g a r w a l

NRO0498439
◦Reverse Charge means the liability to pay tax is on
the recipient of supply of goods and services instead
of supplier of such goods or services in respect of
certain notified categories of supply.
There are two type of
reverse charge scenarios
provided in GST law.

Specified
Dependent
supplies by
on the
any
nature of
unregistere
supply
d person to
and/or
a registered
nature of
person are
supplier.
covered
SUPPLIES OF
SERVICES
UNDER
REVERSE
CHARGE
MECHANISM
(AS NOTIFIED)
SPONSORSHIP SERVICES

RECIPIENT
SUPPLIER – –
RCM
ANY FIRM/BODY
APPLIES
PERSON CORPORAT
E
◦ Employee Directors – NO GST

◦ Non-Employee Directors – GST under RCM


DSA'S
DSA BANK

SERVIC
ES

◦ DSA – INDIVIDUAL RCM

◦ DSA – NOT INDIVIDUAL NO RCM


Business Facilitator
and Business
Correspondent
R
• Business Facilitator to bank
C
M
F • Business Correspondent to bank
C
Business Only spread M
Facilitator ​ Awareness​
R • Agents of business correspondent
Business Indulge in
C to business correspondent
Correspondent ​ Transactions ​ M
GTA SERVICES

NON-
SPECIFIED SPECIFIED
SPECIFIED
RECIPIENT RECIPIENT
RECIPIENT
GST@1 GST@5
2% % GST
EXEMPT
FCM RCM
SECURITY
SERVICES

Any person other than


body corporate to any
registered person
LEGAL SERVICES
◦ AN ADVOCATE TO ANY BUSINESS
ARBITRAL TRIBUNAL, ◦ SERVICES OF ARBITRAL TRIBUNAL TO ANY BUSINESS

INSURANCE AGENT ◦ SERVICES OF INSURANCE AGENTS TO INSURANCE


COMPANIES

AND RECOVERY AGENT ◦ SERVICES OF RECOVERY AGENTS TO BANKS, NBFCs ETC.


MEMBERS OF
OVERSEEING
COMMITTEE TO
RBI
AUTHOR, ARTIST,
PHOTOGRAPHER OR
MUSIC COMPOSER
◦ SERVICES OF AUTHOR TO PUBLISHING HOUSE IS
CHARGED IN RCM BUT HE CAN ALSO GET HIMSELF
REGISTERED IN GST MIN. FOR A YEAR

◦ SERVICES OF ARTIST, PHOTOGRAPHER OR MUSIC


COMPOSER TO PRODUCER, MUSIC COMPANY ETC. IS
CHARGED IN RCM
PERSON NOT REGISTERED/LOCATED IN NON TAXABLE
TERRITORY
SERVICE TO ANY PERSON LOCATED IN TAXABLE TERRITORY OR IMPORTER OF GOODS HAVE TO PAY GST IN RCM
SUPPLY BY CG/SG/UNION
TERRITORY/LOCAL AUTHORITY
◦ Services excluding posts, relation to aircraft, transport or passengers and renting of immovable property to business entity.

◦ Including sale of goods like Used Vehicles; Old and used goods; Seized and confiscated Goods; Waste and scrap
SERVICES OF
LENDING OF
SECURITIES
LENDING
SCHEME,
1997 OF
SEBI

BOROWWER PAYS TAX IN RCM


SUPPLY OF SILK YARN,
UNSHELLED/UNPEELED CASHEW NUTS,
BIDI WRAPPER LEAVES (TENDU),
TOBACCO LEAVES AND RAW COTTON

BY ANY MANUFACTURER/AGRICULTURIST TO ANY REGISTERED PERSON


SUPPLY OF LOTTERY BY LOTTERY DISTRIBUTOR/AGENT TO
CG/SG/UNION TERRITORY/LOCAL AUTHORITY
RENTING MOTOR VEHICLE FOR
PASSENGERS TO A BODY CORPORATE

◦ SUPPLIER OPTING FOR 5% GST WITH LIMITED ITC

◦ IF SUPPLIER IS NOT BODY CORPORATE – GST TO BE PAID IN RCM


BY : MUSKAAN AGGARWAL
NRO0498439

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