RCM on Security Services
Query (Issue) Started By: – Ethirajan Parthasarathy Dated:- 10-1-2019 Last Reply Date:- 12-1-2019 Goods and Services Tax – GST
Got 7 Replies
GST
An individual is registered under GST. He has engaged the services of security agencies (which is a partnership firm). Their services are used for his residence which is personal expense. I am of the opinion that he is not liable for RCM tax. Please confirm..
Reply By KASTURI SETHI:
The Reply:
Dear Querist,
It is taxable. The supplier of Service is other than body corporate (Partnership) and receiver is a registered person. (A person who is registered under GST is registered for business. He may use security service for residence.That is a separate issue) Th
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goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both.
So, all the provision of the act will apply to recipient and in tax payable in relation to the supply. As per Sec 7(1) (a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;
Security service at home of registered person is not in the course or furtherance of business but its personal in nature. GST is basically tax on business. The said transaction is personal in natur
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on reverse charge basis as the recipient and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both.
Does it mean that a Registered proprietor purchase from unregistered person items like vegetables, clothes, payment made to house servant etc for his home he has to pay RCM on such supply.
in my view he is not required to pay RCM on such supply. Same logic may also apply for security services as provision of sec 9(3) and 9(4) are similar.
Reply By KASTURI SETHI:
The Reply:
Analogy does not come into picture. Here emphasis is to be laid on the language of notification dated 31.12.18 itself.
Discussion Forum – Knowledge S
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