Aitha Someswara Rajya Lakshmi

ALL YOU MUST KNOW ABOUT GTA UNDER GST

Background:

The proposal to levy Service Tax on Road transportation Service is proposed through Finance Act 1997, but was withdrawn due to Nation-wide strike. Later on by Finance Act 2004 the same came on to the screen and deferred by because of Nation-wide strike. Finally a committee was appointed to deal with the issue and based on the report finally Service tax made applicable on transportation of Goods by road with effect from 01/01/2005.

The same continues into GST.

Definition:

“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”

Analysis:

Analyzing the above definition, the condition to be satisfied by a service to be GTA is

1. Issue of consignment note is part and parcel of GTA Service.

2. Unless otherwise consignment note is issued the service cannot be brought in to the ambit of GTA.

3. Individual truck/Tempo operators who does not issue Consignment note will not come in to the ambit of GTA. They are exempt from GST.

Benefits available:

For a GTA Service provider,

1. Need not obtain registration though his turnover exceeds Rs. 20 lakhs during the previous Financial Year.

Provided, the service provider is engaged only in supply of GTA Service.

2. No compliance costs.

Levy of tax:

Goods transportation Service is charged at 5% GST on reverse charge basis with the condition that the Service provider has not availed credit of Inputs, Input Services and Capital Goods.

Whereas, there is a notification stating that the GTA Service provider is eligible for availing credit on Inputs, Input Services and Capital Goods provided GST liability is discharged @ 12 % on normal charge i.e., the GTA service provider has to charge 12% GST on his invoice. This is possible only when the GTA Service provider has obtained registration under GST and complied with all the compliances.

Tax liability:

In case of GTA Service,

1. Tax liability is to be discharged on Reverse charge basis i.e., Liability to be paid by the Service recipient.

Exemption:

By way of Notification No. 2/2017– Central Tax (Rate), the following Services are exempt from GST –

1. Services by way of transportation of goods

a. by road except the services of:

(i) a goods transportation agency;

(ii) a courier agency;

b. by inland waterways.

Place of Supply under GST:

In case of GTA Service, the place of Supply would be the place where the transportation of Goods terminated i.e., the location of the Service recipient.

Please note that in 22nd GST Council meeting it has been decided that services provided by a GTA to an unregistered person shall be exempted from GST from a date to be notified in this regard.

Author Bio

Qualification: CA in Job / Business
Company: M/s Ultratech Cement Limited
Location: Guntur, Andhra Pradesh, IN
Member Since: 09 Oct 2017 | Total Posts: 2

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10 Comments

  1. AMOD SHUKLA says:

    my GTA took registration in july but not paid any GST. NOW from december onwards he wants to charge GST 12 per cent and to take input credit on GST PAID ON INSURANCE , truck purchased and spares purchased etc. Pls explain can he do so

  2. CA JK JAIN says:

    Hello,
    Place of Supply under GST:

    In case of GTA Service, the place of Supply would be the place where the transportation of Goods terminated i.e., the location of the Service recipient.
    I doubt about the place of supply. GTA of Kanpur (UP) transports goods to Jodhpur in Rajasthan, then as per your view, CGST and RGST shall be paid under RCM, but in my view IGST shall be paid under RCM. Please share the view.

    1. 240355 says:

      Sir,
      you are right, IGST has to be paid on RCM. When the Service provider and the place of Supply are in Different State, IGST has to be paid.

  3. HK says:

    Place of Supply under GST:

    In case of GTA Service, the place of Supply would be the place where the transportation of Goods terminated i.e., the location of the Service recipient.

    You are in Guntur. You send Cement to Nagpur. You pay the Goods Transport Agency. Termination is therefore in Nagpur. But you are the Service Recipient in Guntur. So, how does this work. Who pays the Reverse Charge GST????

    1. spmaheshwari says:

      you can charge gst on the total bill i.e, cost of cement and transportation,if the payment is made to GTA by you.if GTA is paid by recipient than he has to pay gst on RCM

  4. Satya says:

    Madam,
    1) an Individual is having Reg inn gst and doing TRPT service, but not charging GST in bill, how to treat this by recipient in RCM.
    2) Intercarting goods within factory by Individual, treatment in GTA?
    pl advice your inputs

    1. spmaheshwari says:

      He is not a GTA,the service provided by transporter is exempt and no RCM.The transporter is not issuing any consignment note,he is giving a bill of work done only and exmpt from GST

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