GST Implication on Goods Transport by Road (GTA) (As on 28.11.2022)
INTRODUCTION:-
Transportation is a vital part of the
economy as any problem in transportation disrupts the entire business channel.
This is why any petrol price change has a far-reaching effect in disruption of
business. In India most popular form of transport is via road.
There are Three type of persons who are engaged in transport
of Goods by Road.
1) Normal Transporter (Who does not
issue Consignment Note).
2) Goods Transport Agencies (Who are
issue Consignment Note).
3) Courier Agency.
EXEMPTION:-
Serial No. 18 of Notification No. 12/2017- Central Tax (Rate)_28.06.2017 provide
the following exemption.
Services by way of transportation of goods
by road except the services of,
1)
A goods transportation agency.
2)
A courier agency.
From
the above exemption it can be concluded that GTA Services are taxable and hence
we will discuss the GST Implication on GTA Services.
WHAT IS THE GTA:-
As
per Notification No. 11/2017-Central Tax (Rate) dated 28th June, 2017, “Goods
transport agency” means any person who provides service in relation to
transport of goods by road and issues consignment note, by whatever name
called.
From
the analysis of the meaning of GTA, It can be said that only those persons are
covered in GTA who are issue Consignment Note, while other are exempted from
GST and hence consignment note is essential condition to be qualify as GTA.
WHAT
IS CONSIGNMENT NOTE:-
A
consignment note is a document issued by a goods transport agency against the
receipt of goods for the purpose of transporting the goods by road in a goods
carriage.
If
a consignment note is issued, it means that the lien on the goods has been
transferred to the transporter. Now the transporter is responsible for the
goods till its safe delivery to the consignee.
SILENT FEATURE OF CONSIGNMENT:-
·
It should be serially numbered
·
Date of transportation of goods.
·
Name of consignor.
·
Name of consignee.
·
Details of goods.
·
Place of origin.
·
Place of destination.
·
Person liable to Pay GST-i.e.
Consignor or Consignee or GTA.
· Registration number of Vehicle.
SAMPLE OF CONSIGNMNET NOTE:-
SERVICES
PROVIDED BY GTA OTHER THAN GOODS TRANSPORT:-
· Packing or unpacking.
· Loading or unloading.
· Temporary Warehousing.
· Other ancillary service.
If above mentioned services are
provided separately than it is considered as independent activities and GST
need to be pay as applicable.
But above services are not provided
independently than they are covered under GTA service.
WHO IS LIABLE TO
PAY GST:-
If GTA exercises the option to itself
pay GST on services supplied by it. (Foreword Charge):-
Liable to pay GST:-
GTA
SAC Code:- 9965
GST Rate:- 5% (Without
ITC)
12% (With ITC)
The option by GTA to itself pay GST on
the services supplied by it during a Financial Year shall be exercised by
making a declaration in Annexure V on or before the 15th March of
the preceding Financial Year.
Here I am specifying herewith the Annexure
V format.
FORM
Form
for exercising the option by a Goods Transport Agency (GTA) for payment of GST
on the GTA services supplied by him under forward charge before the
commencement of any financial year to be submitted before the jurisdictional
GST Authority.
Reference
No.-
Date:
-
1.
I/We______________ (name of Person), authorised representative of M/s…………………….
have taken registration/have applied for registration and do hereby undertake
to pay GST on the GTA services in relation to transportation of goods supplied
by us during the financial year……………under forward charge in accordance with
section 9(1) of the CGST Act, 2017 and to comply with all the provisions of the
CGST Act, 2017 as they apply to a person liable for paying the tax in relation
to supply of any goods or services or both;
2.
I understand that this option once exercised shall not be allowed to be changed
within a period of one year from the date of exercising the option and will
remain valid till the end of the financial year for which it is exercised.
Legal
Name: -
GSTIN:
-
PAN
No.
Signature
of Authorised representative:
Name
of Authorised Signatory:
Full
Address of GTA:
(Dated acknowledgment of
jurisdictional GST Authority)
If GTA does not exercises the option
to itself pay GST on services supplied by it. (Reverse Charge):-
Liable to pay GST:- Any
Factory, Society, Co Operative Society, Any GST Registered person, Any Body
Corporate, Any Partnership Firm whether Registered or Not, Casual taxable
person.
(Provided all are these located in Taxable
Territory and liable to pay freight for transportation of goods).
SAC Code:- 9965
GST Rate:- 5%
(Without ITC)
PLACE OF SUPPLY FOR GTA:-
The place of supply of service by way of transportation of goods, including by mail or courier to,
·
A registered person, shall be the
location of such person
·
A person other than a registered
person, shall be the location at which such goods are handed over for their
transportation.
REGISTRATION
FOR GTA:-
Every supplier shall be liable to be
registered under this Act in the State or Union territory from where he makes a
taxable supply of goods or services or both, if his aggregate turnover in a
financial year exceeds the threshold limit.
Aggregate turnover:- As
per Section 2(6) of CGST Act, 2017 “aggregate turnover” means the aggregate
value of all taxable supplies (excluding the value of inward supplies on which
tax is payable by a person on reverse charge basis), exempt supplies, exports
of goods or services or both and inter-State supplies of persons having the
same Permanent Account Number, to be computed on all India basis but excludes
central tax, State tax, Union territory tax, integrated tax and cess.
Threshold Limit:-
For Service Provider is Rs. 20 Lakhs.
However If GTA does not exercises the option to itself pay GST on services supplied by it and all of the supplies are covered under the RCM then GTA is exempted from registration. (Notification No. 5/2017 – Central Tax_19.06.2017)
TREATMENT OF INTERMEDIARY AND ANCILLARY
SERVICE:-
GTA provides service to a person in relation
to transportation of goods by road in a goods carriage, which is a composite
service. Intermediary and ancillary services may include various services such
as loading/unloading, packing/unpacking, transshipment and temporary
warehousing, which are provided in the course of transport of goods by road.
These services are not provided as independent services but as ancillary to the
principal service, namely, transportation of goods by road. The invoice issued
by the GTA for providing the said service includes the value of intermediary
and ancillary services.
In view of this, if any intermediary and
ancillary service is provided in relation to transportation of goods by road,
and charges, if any, for such services are included in the invoice issued by
the GTA, such service would form part of the GTA service and would not be
treated as a separate supply. In fact, any service provided along with the GTA
service that is part of the composite service of GTA shall be taxed along with
GTA service and not as separate supplies.
However, if such incidental services are
provided as separate services and charged separately, whether in the same
invoice or separate invoices, they shall be treated as separate supplies.
SAC CODE & GST RATE WHERE GOODS
TRANSPORT VEHICLES PROVIDED ON RENT:-
SAC CODE:- 9966
GST RATE (WITH OPERATOR):-
Renting of goods carriage where the cost of
fuel is included in the consideration charged from the service recipient:- 12%
Others:- 18%
GST RATE (WITHOUT OPERATOR):-
18%
WHAT ARE EXEMPTION AVAILABLE TO GTA:-
Services
provided by a goods transport agency, by way of transport in a goods carriage
of,
·
Agricultural produce
·
Milk, salt and food grain including
flour, pulses and rice
·
Organic manure
·
Newspaper or magazines registered with
the Registrar of Newspapers
·
Relief materials meant for victims of
natural or man-made disasters, calamities, accidents or mishap
·
Defence or military equipment.
Comments
Post a Comment