GST Reverse Charge Exemption Rs 5000 per day

GST Reverse Charge Exemption Rs 5000 per day

GST Reverse Charge Exemption Rs 5000 per day: GST Reverse Charge Exemption Rs 5000 per day Details updated below.

Introduction

Here we are with the information on the GST Reverse Charge Exemption notification which has been passed by the authorities recently and as per the notification the Reverse charge is been allotted to Rs. 5,000 per day. This article deals with the all the needed information along with the background to understand this concept.

Reverse Charge Background

Reverse charge is nothing but the recipient is liable to pay tax for imports of services for intangible properties. And this if found common in many countries like Canada. Generally it is the supplier who pays the tax on supply of goods and services at some case the receiver becomes liable to pay the tax that’s the situation where the tax gets reverse and this process is termed as Reverse Charge. In case of India this is a new concept and people are yet trying to understand this concept.

Reverse Charge under GST Old Before 2017

Here we are going to provide details on the GST Reverse Charge for goods and services before the 2017 tax process. Have a glance at it to know the details correctly.

• Insurance agent
• Service of a director to a company
• Manpower supply
• Goods transport agencies
• Non-resident service providers
• Services involving aggregators.

Reverse Charge under GST New Section 9(3) of CGST Act, 2017

Here we have given information on the new changes brought under the new CGST Act 2017, on Reverse Charge for goods and Services by the authorities in India.

• Non-resident service provider, Goods Transport Agencies
• Legal service by an Advocate/ Firm of Advocates, Arbitral Tribunal
• Sponsorship Services
• Specified Services provided by Government or Local Authority to Business entity
• Services of a director to a company
• Insurance agent, Recovery Agent of Bank/FI/ NBFC
• Transportation Services on Import
• Permitting use of Copyright
• Radio Taxi services to E-commerce aggregator (eg: Ola, Uber, etc.)

Points to consider in knowing the Reverse Charge

• Exemption up to Rs. 5000 is on intra state taxable supply
• There is a limit of transaction value of Rs. 5,000/- per day:- means in case of supply more than Rs. 5,000/- per day, whole of such supply shall be taxable under reverse charge 9(4).
• Limit is in respect of all suppliers:- This should be noted that the limit is not respect  to one supplier.
• All persons who are required to pay tax under reverse charge have to register for GST irrespective of the threshold
• A business required to pay GST under Reverse charge under section 9 (3), even if not engaged in the taxable supply, for instance a health care unit, would automatically need to comply with section 9(4 ) WRT to supply by unregistered dealer to a registered dealers.

Conclusion

With this the article is been concluded that the concept of Reverse Charge is new but it is necessary for the Citizens to take the responsibility in knowing it to know about the concept clearly and detail.