Yes. RCM will be applicable in this case.
You have to pay GST @5% in reverse charge for which no ITC shall be available.
Is RCM applicable for passenger transport provided for Tours
Dear Sir/MAdam Im running a Tour Operator Business, we deal with many Passenger transport agents for Car rentals in India some of are Unregistered with GST. Should we pay GST of 5% on RCM when we booked through Unregistered agents? please kindly clarify. Tour Operators has no ITC
Asked 7 years ago in GST
There are two opinion prevailing here.
1) Some experts are of opinion that, If someone is not registering due to turnover is below 20 lakhs, then sec 9(4) does not apply, and hence you are not liable to pay GST @5%. However, this opinion is only accepted by some of the experts.
2) To avoid litigation you can pay GST @5% at reverse charge.
Thank you very much for your reply. So, we have to pay 5% under RCM but no ITC claim. Correct? We are based from Andhra Pradesh, if our client also from same state but planning to travel Kerala and Tamil nadu tour for 10 days...in this case what will be the place of supply? and whether GST applicable or IGST?
Asked 7 years ago
Yes. You got that right.
The place of supply in such case would be Andhra Pradesh and hence no IGST.
Also note the exemption limit of 5000 per day.
exemption of Rs.5000/- per day is for what? and is there any exceptions for RCM on passenger transport like Car rentals/Coach rentals? How much percentage should calculate for RCM?
Asked 7 years ago
It is available in your case also. As per the notification if you make a purchase from unregistered dealer in entire day of Rs 5000 then No GST is to be charged under reverse charge. Please note it is for entire day not per unregistered dealer
If you are receiving any goods/services on which GST is payable on reverse charge, and the value of such goods/services is upto Rs. 5000, then you are exempt from such tax payable in reverse charge.
Note that 5000 limit per day is not for one supplier, it's the aggregate of such goods/services received in a day.
Yes. GST @5% would be applicable in reverse charge.
Please feel free to call/ revert in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
If suppose we took service from Unregistered agents of Rs.20,000/- can we split the Purchase invoice and make split payment to avail exemption of Rs. 5000/- per day to the same supplier? As we do not get any ITC so is it mandatory declare inward supplies in GSTR1 and GSTR3B
Asked 7 years ago
Yes, you can do so if the invoice is less than 5k.
Further, please note exemption limit of 5k is for good/ services received from all the unregistered supplier in a day.
There apart, this 5k exemption is only for CGST. you still need to pay IGST on in that.
Please feel free to call/ revert in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
You can split the invoice to rs 5000 per day. But then you must take care no other purchases made from any other unregistered dealer on tgat day.
Yaa you need to mention the same in GSTR
Sir/Ma'm. So this exemption will be only for intra-state inward supplies not for Inter-state (IGST) right ? If we take service from a supplier from Delhi based then is this exemption applicable?
Asked 7 years ago
Yes. Correct.
Yes. Exemption is Rs. 5000 per day for all suppliers. You can split invoice for different dates.
Yes. Declaration of inputs is mandatory even if you can't claim ITC.
The exemption of Rs. 5000 per day is for intra-state supplies and not for inter-state supplies.
Also note that such exemption is for payment of CGST only, SGST shall apply.
Sir/Ma'm...Should we also declare inward supplies took from 'Foreign Company'? Generally we transfer payments to their Indian Account or sometime we do in their Foreign Bank accounts in USD through an Authorized Forex Company..We make payment to Authorized Forex Company and they do transfer to Our supplier in USD
Asked 7 years ago
Yes. You should account foreign supplies as well and pay IGST on the same.
Yes. Also, if the services by a foreign component after provided to you in India and that company is not registered, you are liable to pay GST on the same in reverse charge.
It is a Foreign registered Company and giving services in the Foreign land to an Indian client. Payment will be transferred to an Indian Forex company Including of GST. Say for example We suppose to transfer USD 100 to 'X' company in Sri Lanka in their sri Lankan Bank account, then we'll submit the necessary documents and Invoice of USD100 to Indian Licensed Forex Company and they will send an Invoice with USD100 with present ROE (rate of exchange) + GST., so we'll transfer payment in INR to Forex company and they will forward to our supplier in USD. So in this case which Supplier we have to declare in the Inward supplies? either Forex Company to wgich we had transfer the payment or Sri Lankan Company?
Asked 7 years ago
The query is already taken care of by other experts. Please feel free to let me know in case any part of it has been left unattended.
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