Reverse Charge Buying from URD Dealers

Reverse Charge Mechanism (in case of supplies made by unregistered persons to registered persons) made applicable vide Notification No. 13/2017- Central Tax (Rate) dated 28th June, 2017 deferred to 30th september 2019 vide Notification No. 01/2019 – Central Tax (Rate) dated 29th January 2019 and will apply starting from 1st October 2019, only on specified goods/services and specified persons.

will apply if the below conditions are met:

  • There should be a supply of goods or services
  • The supply should be in respect of taxable goods/services
  • Supply by an unregistered person.
  • Supply to a registered person
  • Supply in come of intra-state supply as compulsory registration is required for inter-state sales

Please keep a close track of the expenses portion of your P/L account. Some example of expenses which can attract GST under RCM-

  • Rent
  • Commission payments
  • Printing and stationery
  • Repairs and Maintenance
  • Office Maintenance
  • Vehicle maintenance
  • Computer maintenance
  • Legal Fees
  • Consultancy Fees
  • Professional Fees
  • Audit Fees
  • Freight and transportation expenses (GTA)
  • Gift expenses
  • Business promotion expenses