Reverse Charge Mechanism in GST

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Reverse Charge Mechanism in GST

 

Meaning of Reverse Charge

 

Reverse Charge means the liability to pay tax by the recipient of supply of goods or services or both instead of the supplier of such goods or services or both.

 

Summary on Reverse Charge Mechanism

What to do for GST?

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With the enactment of the GST laws, the introduction of destination based taxation GST would replace Excise, Service Tax, VAT, etc.

As GST Law being proposed to be introduced from 1st of July 2017, it is apparent that the management of the organization would face the issues in transition from existing indirect taxation regime to the new GST taxation.

Following are the steps one can follow for easy transition:

Steps involved in GST Transition

1.       Migration:

The very first step in the GST transition is to migrate from the existing registration to GST after getting the provisional id for migration from current tax logins to GST portal. I am sure that most of you must have already commenced the process of migrating from

Taxes and levies that will be subsumed under GST

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What are the taxes and levies that will be subsumed in GST?

Following are the taxes and levies that will be subsumed under GST:

1.       Central Excise Duty

2.       Additional Excise Duties

3.       Excise Duty levied under the Medicinal and Toilet Preparation (Excise Duties) Act, 1955.

4.       Service Tax

Cases where penalty can be imposed under Companies Act 2013

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Section 4(5)(ii) – Furnishing wrong or incorrect information while applying for reservation of the name.

Who is Liable   – PERSON MAKING APPLICATION

Amt of Penalty – UPTO Rs. 1,00,000/-

 

Section 11(2) – Commencing business without submitting declaration about having minimum share capital

Who is Liable   – COMPANY

Amt of Penalty – UPTO Rs. 5,000/-

 

Section 12(8) – Default in complying with provisions relating to intimation and display of registered office of company and display of name of company

Who is Liable  – COMPANY & EVERY OFFICER WHO IS IN DEFAULT

Amt of Penalty –Rs.1,000/- PER DAY MAXIMUM UPTO Rs.1,00,000/-

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