What is Reverse Charge under Goods and Service tax (GST)?

Under Goods and Service tax (GST), a person supplying the goods and services are liable to pay GST in India. This is a basic rule of GST i.e. charge is created on the person who is supplying the goods or/and services.

However, under some circumstances, the person receiving the goods or services is liable to pay GST to the government. The charge is reversed or in other words, it is known as Reverse Charge.

This happens generally in case of imports of goods or services, in case you hire GTA services etc. However, GST has not notified the services yet.

Important points

Here are some of the important points that may be useful if you are covered under Reverse Charge provisions:

1. Exemption limit of Rs.25 Lakh is not available if you are covered under GST.
2. Once you are covered under reverse charge, you need to take the registration and file all the due returns.
3. Pay the required taxes on time to avoid being in default.
4. All the provision of GST shall be applicable to you as you are a normal registered supplier/dealer.

Conclusion

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Register for Goods and Services Tax (GST) in India