Goods and Services Tax – General FAQ on GST – Frequently Asked Questions – 170830-01 – LEVY Q. 1. What is the taxable treatment of the services provided by a Service Provider in respect of such services which are covered under Notification No. 25/2012-Mega Exemption Notification for Government, railways and other Departments? Such Services are exempt from Service Tax, hence who will bear the GST tax element of 18%, the Service Provider or the Principal Employer? Ans. Exemption notification for services have been notified. Refer Not. No. 12/2017-Central Tax (Rate) & Not. No. 9/2017-Integrated Tax (Rate). Q. 2. Normally the Service Provider does not issue invoice in Government Jobs. The Sectional/departmental engineers prepare the measurement books and record the details of work done on a subsequent date. Hence how Point of Service will be reckoned since the Service Provider does not raise the invoice? Ans. Time of supply of services has been explained in Section 13 of CGST Act. The
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ise invoice or services whichever is earlier and the Service Provider has to pay Service Tax @ 18% on value of work done although he has not received any payment from the client till date? Ans. Time of supply of services has been explained in Section 13 of CGST Act. The terms for payment do not decide the taxability of a particular transaction. So even if payment for a particular supply has not been received it will still be liable for GST. Q. 5. Intermediary services and services provided by Banking Company to its Account Holders – Intra-State or Inter-State supply? Ans. Place of supply provisions in Sub-Section (12) of Section 12 of IGST Act may be referred to. Q. 6. Cross border services provided by an Indian branch to offshore branch/HO which are not Intermediary Services – are they exempted? Ans. Section 13 of IGST Act, 2017 may be referred. The place of supply is outside India but as the supplier is located in India, it is a case of Inter-State supply and subject to IGST. It will
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/SSI/exempted unit, will he be able to take Input Tax Credit of the GST paid on reverse charge basis? Ans. Yes, input tax credit of tax paid on reverse charge basis by the recipient is allowed to the recipient and the credit can be taken even in the same month. Q. 11. Whether, any Indian providing services to a U.S. based company on contract basis is required to pay reverse charges on charges deducted by a U.S. based company? Ans. It depends on the nature of charges deducted. The place of supply is outside India but as the supplier is located in India, it is a case of Inter-State supply and subject to IGST. It will be zero rated if the sale proceeds are realized in convertible foreign exchange. Q. 12. Under the new GST Act, the liability or payment of GST still with consignee or consignor? Ans. Reverse charge mechanism has been provided in GST law for GTA and the recipient of GTA service (he may be consignor or consignee) is required to pay GST. Notification No. 13/2017-Central Tax (Ra
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istered dealer? Ans. Yes, GTA can carry the goods. GST on GTA services is liable to be paid on RCM basis by the recipient. The supply of services of goods transport by road transporter other than a GTA and a courier is exempted under Notification No. 9/2017-Central Tax (Rate). Q. 16. Whether reimbursement of expenses to staff comes under RCM? Ans. Reimbursement is an expense in the course or furtherance of business and if the same is against a taxable supply taken from an unregistered supplier, RCM will apply. Q. 17. Whether tax under RCM is applicable for expenses incurred towards doctor sponsorship programme? Ans. As per Notification No. 13/2017-Central Tax (Rate), Sl. No. 4 sponsorship to anybody Corporate/Partnership firm comes under RCM. REGISTRATION Q. 18. Do dealers having turnover below ₹ 20 lakh need to compulsorily register if they are supplying through online portals? Ans. Yes, as per Section 24(ix) of the CGST Act, 2017, persons who supply goods or services or both, o
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If the corner kiranewala has turnover greater than ₹ 20 lakh in the preceding financial year he is liable to be registered, charge GST and provide you an invoice for your purchase. Q. 22. How will I know if his turnover is below ₹ 20 lakh and if he is exempt from GST and that he will not charge me any GST? Ans. Person having turnover over ₹ 20 lakh will take registration and registration certificate will be displayed at a prominent location along with GSTIN on the name board. If you suspect that he has not taken registration, a complaint can be made and suo motu registration will be given under Rule 16 of CGST Rules, 2017. Q. 23. Will all establishments display a certificate from government (displaying his turnover category) and their GST Registration No. which should appear on all his cash memos/bills? Ans. Yes. For details, Rule 18 of CGST Rules, 2017 may be referred to. Q. 24. Does a trader who has turnover of less than ₹ 20 lakh and are selling on e-commerce
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than ₹ 20 lakh but working for offices that are registered in Mumbai and have branch offices in Delhi? Ans. If you are supplying services to the branch office in the same State, it will be Intra-State supply and you will not be liable for registration. If you are making Inter-State supply, you will be liable for registration and benefit of threshold exemption would not be admissible. Q. 28. We are a private Ltd. Co. having Head Office at Mumbai and Branch Office in Gujarat and U.P. dealing in products having Tax Rate @ 0% dealing intra-state and inter-state supply : Since the products are 0% GST products are we require to register under GST if turnover is above ₹ 20 lakh? Ans. No. Q. 29. We are purchasing from Haryana and selling in Haryana and also inter-state sales. Currently we do not have any GST registration in Haryana. Since the Product is 0% GST are we suppose to register in Haryana? Ans. No. Registration is not required as you are dealing exclusively in products th
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eed to register separately as an Input Service Distributor? Ans. Yes, as per Section 24(viii) of the CGST Act, 2017, an Input Service Distributor is required to take separate registration under the Act. TRANSITION Q. 33. How the deemed credit of available stock and Work in Progress (WIP) to be availed by an Assessee? Ans. The provisions relating to deemed credit are contained in the proviso to Section 140(3) of the CGST Act, 2017 and Rule 117(4) of the CGST Rules, 2017. ITC at the rate of 60% is allowed where the Central Tax rate on goods is 9% or more; it is allowed at the rate of 40% in other cases. It is allowed only after the payment of applicable tax. It can be taken in the first six tax periods only. Deemed credit is allowed only to traders and not to manufacturers. Q. 34. Is there any provision/instruction under the CGST Act for taking/verifying the physical stock of the units as on 30th June, 2017. It is pertinent to mention here that some State Excise & Taxation department
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advances in hand as of June 30th for goods to be supplied from July 1? Ans. No. Q. 38. Builder is demanding balance money due to tax rate changed under GST. Do we have to pay service tax on entire amount of registration under GST, also if abatement provided before GST is available or not? Ans. GST is operational from 1-7-2017. Only on the balance amount GST will be applicable on future payments. For tax paid under the earlier law, Section 142(11) of the CGST Act, 2017 may be referred to. Q. 39. How to avail credit on raw material and packing materials stored outside factory on which credit could not have been availed due to the specific restriction in the permission given by the Excise department? Whether these goods can be treated as in-transit and credit be availed under Section 140(5) within 30 days of GST implementation? Ans. Goods can be treated in transit only when the same have not been received by the recipient which is not the case in this scenario. Q. 40. Clarity is needed o
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hat product will be 79.38 and if the GST of 28% will be added to the amount without adding any profit then it will be 79.38+22.22 (28% GST) and the total value of the product will be ₹ 101.60/- which is higher than MRP. So how it will be sold at the value higher than the MRP? Ans. MRP can be revised albeit with certain precautions and for only for certain time period. Press Note of Ministry of Consumer Affairs, Food & Public Distribution dated 4-7-2017 may be referred to. Q. 44. Section 16 of IGST Act, 2017 has a provision for Zero Rated supply under GST for supply of goods and services to SEZ Units – Need explicit clarity whether this also covers for supply of goods and services by one SEZ unit to another SEZ unit. E.g. Exchange levying fees and penalty to its trading members who are also IFSC Units. Ans. Yes, supply of goods and services by one SEZ unit to another SEZ unit would be considered zero rated supplies under Section 16 of the IGST Act, 2017, which deals with zero
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notified soon. Q. 48. When are the recommendations of the sector wise task force expected to be submitted to the GST Council. Can representations still be made to the sectoral task force? Ans. Representation can be submitted to the sectoral working groups. Q. 49. How will I know whatever GST I pay is really paid to government by various makers/sellers and not pocketed by the seller? Ans. Person, selling to you, would have purchased his products/inputs from some supplier. That supplier while filing his outward supply details (GSTR-1) will quote the GSTIN of the your seller. And he will have to accept the same in his GSTR-2. Therefore the system captures the data of your seller. Action can be subsequently taken in case of evasion of tax. Q. 50. Is stock transfer possible without paying GST in case of takeover of a Partnership firm by a Private Limited Company? Ans. One has to see the conditions given in entry 4 of Schedule II of the CGST Act, 2017. If it is a supply as per this entry, it
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