Reverse Charge Mechanism (RCM) under GST Suspended till 30 Sept. 2019, notifies CBIC

Reverse Charge Mechanism (RCM) under GST further Deferred/ Suspended till 30 Sept. 2019, notifies CBIC

CBIC has notified that the provisions relating to Reverse Charge Mechanism (RCM) under GST, i.e. under Section 9(4) of the CGST Act, 2017, Section 5(4) of the IGST Act, 2017 and Section 7(4) of the UTGST Act, 2017 have been further Deferred/ Suspended by Govt. by 1 year, i.e. from 30 Sept. 2018 to 30 Sept. 2019. Earlier, the CBEC/ CBIC had notified on 13 Oct. 2017/ 23 March 2018/ 29 June 2018 that implementation of RCM under GST has been deferred upto 31 March 2018/ 30 June 2018/ 30 Sept. 2018 respectively.

It may be noted that the GST Council has recommended in it’s 28th Meeting held at New Delhi on 21st July 2018 to defer the provisions relating to Reverse Charge Mechanism (RCM) under GST for further one year upto 30 Sept. 2019. Also GST Council has recommended to restrict the scope of provisions relating to RCM under GST to supply of specified goods only.

Further, it may be noted that there is no change on reverse charge provisions under Section 9(3) of CGST/ SGST Acts, Section 7(3) of UTGST Act and Section 5(3) of the IGST Act, relating to GTA, Legal Services provided by an Advocate, etc. and for that reason only it’s called to be a partial suspension of RCM.

This partial suspension of RCM is basically meant for convenience of large taxpayers and survival of unregistered taxpayers. It will provide an opportunity to such taxpayers with more time to be familiar with the compliance requirements. Meanwhile the Government will also be able to streamline the relevant procedures. In fact large/ registered businesses were reluctant to make compliance/ pay tax on behalf of small/ unregistered businesses and they were avoiding to do business with them. This will benefit small businesses and substantially reduce compliance costs.

Key Recommendations of 28th GST Council Meeting (dt. 21 July 2018)

GST RCM Provisions deferred upto 30 Sept. 2019: CBIC Notification No.22/2018 Central Tax Rate dt. 6 Aug. 2018

GST RCM Provisions deferred upto 30 Sept. 2019: CBIC Notification No.23/2018 Integrated Tax Rate dt. 6 Aug. 2018

GST RCM Provisions deferred upto 30 Sept. 2019: CBIC Notification No.22/2018 UT Tax Rate dt. 6 Aug. 2018

Reverse Charge Mechanism (RCM) under GST further Deferred/ Suspended till 30 Sept. 2018: CBIC Notifications

CBIC has notified that the provisions relating to Reverse Charge Mechanism (RCM) under Section 9(4) of the CGST Act, 2017, Section 5(4) of the IGST Act, 2017 and Section 7(4) of the UTGST Act, 2017 have been further Deferred/ Suspended by Govt. for 3 months upto 30 Sept. 2018. Earlier, the CBEC/ CBIC had notified on 13 Oct. 2017/ 23 March 2018 that implementation of these provisions has been deferred upto 31 March 2018/ 30 June 2018 respectively.

GST RCM Provisions deferred upto 30 Sept. 2018: CBIC Notification No.12/2018 Central Tax Rate dt. 29 June 2018

GST RCM Provisions deferred upto 30 Sept. 2018: CBIC Notification No.13/2018 Integrated Tax Rate dt. 29 June 2018

GST RCM Provisions deferred upto 30 Sept. 2018: CBIC Notification No.12/2018 UT Tax Rate dt. 29 June 2018

Reverse Charge Mechanism (RCM) under GST further Deferred/ Suspended till 30 June 2018: CBEC Notifications

The CBEC has notified that the RCM provisions have been further deferred/ suspended till 30 June 2018, in line with GST Council recommendations dt. 10 March 2018. In the meantime, a Group of Ministers  (GoM) will look into the modalities of its implementation to ensure that no inconvenience is caused to the trade and industry.

RCM Suspended till 30 June 2018: CBEC Notification 10/2018 Central Tax Rate dt. 23 March 2018

RCM Suspended till 30 June 2018: CBEC Notification 11/2018 Integrated Tax Rate dt. 23 March 2018

RCM Suspended till 30 June 2018: CBEC Notification 10/2018 UT Tax Rate dt. 23 March 2018

Partial Suspension of ‘Reverse Charge Mechanism (RCM) under GST till 31 March 2018: CBEC Notifications

GST Council, in its 22nd Meeting dt. 6 Oct. 2017, has recommended that the reverse charge mechanism (RCM) shall remain deferred/ suspended till 31.03.2018 and will be reviewed by a committee of experts.

Accordingly, the CBEC has notified suspension of Reverse Charge Mechanism (RCM) till 31 March 2018 under Section 9(4) of the CGST Act, 2017, Section 5(4) of the IGST Act, 2017 and Section 7(4) of the UTGST Act, 2017. There is nothing in the Notification on the effective date of RCM suspension. However GSTN has tweeted on 12 Oct. 2017 that the RCM Suspension will be applicable w.e.f. the date of Notification (i.e. 13 Oct. 2017).

RCM Suspended till 31 March 2018: CBEC Notification 38/20117 Central Tax Rate dt. 13 Oct. 2017

G.S.R.1262(E).— In exercise of the powers conferred by sub-section (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby makes the following amendment in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No.8/2017- Central Tax (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 680(E), dated the 28th June, 2017, namely:-

In the said notification, the proviso under Paragraph 1 shall be omitted.

2. The exemption contained in the notification No. 8/2017-Central Tax (Rate) dated the 28th June, 2017 as amended by this notification shall apply to all registered persons till the 31st day of March, 2018.

Note:- The principal notification No.8/2017-Central Tax (Rate), dated the 28th June, 2017 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 680 (E), dated the 28th June, 2017.

RCM Suspended till 31 March 2018: CBEC Notification 32/20117 Integrated Tax Rate dt. 13 Oct. 2017

RCM Suspended till 31 March 2018: CBEC Notification 38/20117 UT Tax Rate dt. 13 Oct. 2017

Related Posts:

ICAI Suggestion to FinMin on ‘Alternative workable RCM’ (Phased implementation)

Shared by: Kewal Garg | You can reach him via email: kewalgarg@caclub.in

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