Question on GST refund

Question on GST refund

Hi - 
I have applied for GST refund ( Unutilized ITC ) . I carry business involving Import Software service.
I pay IGST on Basic and TDS part. ( Reverse Charge Mechanism )


For example I paid 100 INR to foreign company for availing their service.

I paid 18 % on 100 INR 

+ 18% on 10 INR TDS amount (say 10 INR TDS paid to Income tax department )
Total Taxable value = 100+10 =110 .

GST office saying department will only refund IGST paid on 100 INR only.


But As I know IGST should be paid on TDS ( income tax TDS ) part also.

if possible, can you please give some Supporting LINK - Judicial cases Ref if you agree.
I need to submit it tomorrow .

Thank you in advance

Asked 5 years ago in GST

You are making the transaction very confusing because you are paying the TDS yourself rather than deducting it from the value of supply and GST also needs to be paid on value of supply and since your invoice value is 100 they would refund GST on invoice value.

How are you claiming refund of such GST what services are you providing?

Why are you deducting TDS? Have you checked whether it is required or not.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you.

Naman Maloo

CA, Jaipur

4303 Answers

101 Consultations

Talk to Naman Maloo

Firstly, TDS should have been 11 and not 10 by grossing up method.

There are no case rulings as such under GST regime.

In my opinion, GST shall have to be paid on actual payment + TDS. Since rcm has to be paid on the transaction value and transaction value would include TDS.

Kindly draft a proper submission. We may assist you with the same.

Lakshita Bhandari

CA, Mumbai

5687 Answers

942 Consultations

Talk to Lakshita Bhandari

Dear Sir,

Hope you are doing well !!

You need to do reverse calculation and GST shall have to be paid on total taxable value.

We may assist you in proper submission.

It is advisable to take a phone consultation for detailed discussion.

Payal Chhajed

CA, Mumbai

5189 Answers

302 Consultations

Talk to Payal Chhajed

Hello,

Under the GST regime, the withholding tax(TDS) will be liable to be subjected to GST.

I hope this answer satisfies your requirements.

Regards,

CA Hunny Badlani

Hunny Badlani

CA, Madhya Pradesh

2608 Answers

16 Consultations

Talk to Hunny Badlani

The amount of tds will be added for gst calculation so you need to do reverse calculation because gst is payable on total taxable value.

Karishma Chhajer

CA, Jodhpur

2452 Answers

29 Consultations

Talk to Karishma Chhajer

- Actual import is of Rs.100. I think you are grossing up and bearing TDS from your pocket and the client is getting actual amount of invoice i.e. Rs.100. In such case, GST is payable on Rs.100 only. Grossing up is according to income tax. You are also required to pay GST on Rs.100 only.

Vivek Kumar Arora

CA, Delhi

5015 Answers

1138 Consultations

Talk to Vivek Kumar Arora

The CBEC vide FAQ published by CBEC in September 2011 has also clarified this aspect as
follows:
“Service Tax is to be paid on the gross value of taxable service which is charged by a
Service Tax assessee for providing a taxable service. Income tax deducted at source is
includible in the charged amount. Therefore, service Tax is payable on the gross amount
including the amount of Income Tax deducted at source also”.

Asked 5 years ago

Then show the value of supply as the value plus TDS amount and don't represent it as gst on TDS amount.

Naman Maloo

CA, Jaipur

4303 Answers

101 Consultations