Articles Compiles list of 84 types of expenses on which we have discussed if GST is applicable or not and if applicable what will be rate of GST and Eligibility for Input Credit-

Sr. No Nature of Expense Rate of Tax Whether registered  supplier will levy tax Reverse Charge (If supply is unregistered) Whether Eligible for Input Credit
1 Salary, wages & bonus paid to employee 0% No No No
2 Electricity bill 0% No No No
3 Water Charges/ Plain Water 0% No No No
4 Bank Interest 0% No No No
5 Professional Tax 0% No No No
6 BMC Tax 0% No No No
7 Building / Property Tax 0% No No No
8 Rent Deposits 0% No No No
9 Other Deposits 0% No No No
10 Petrol / Diesel/ CNG/Kerosene Expenses (Motor Spirit) 0% No No No
11 Liquor Expenses 0% No No No
12 Registration Fees (ROF / ROC / RTO etc) 0% No No No
13 Bad Debt 0% No No No
14 Donation 0% No No No
15 Labour  Welfare Contribution to Government 0% No No No
16 Fine & Penalties 0% No No No
17 Conveyance Expense – Non AC Taxi, Auto, Bus, Train 0% No No No
18 Loading & Unloading in relation agricultural produce/ Hamali 0% No No No
19 Rent Paid for residential use 0% No No No
20 Godown Rent for agricultural produce 0% No No No
21 News paper & magazines 0% No No No
22 Remuneration to Director & partners 0% No No No
23 Conveyance Expense – Radio Taxi like OLA & UBER or other AC vehicle 5% Yes Yes No
24 Payment to Goods Transport Agency 5% No Yes Yes
25 Traveling in Train by AC or First class 5% Yes Yes No
26 Job Work / Labour Charges for textile yarn & textile fabric 5% Yes Yes Yes
27 Job Work / Labour Charges for diamond, jewellery & precious metal 5% Yes Yes Yes
28 Job Work / Labour Charges for printing of books, journals & periodicals 5% Yes Yes Yes
29 Food & Beverages Expense (Non AC restaurant) 12% Yes Yes No
30 Room Rent in a hotel, lodge  (Rs.1000 to 2500 per room per day 12% Yes Yes Yes
31 Fuel (Furnace Oil/LPG) 18% Yes Yes Yes
32 Sales Promotion/Business Promotion 18% Yes Yes Yes
33 Food & Beverages Expense (AC restaurant) 18% Yes Yes No
34 Mineral water 18% Yes Yes Yes
35 Truck/ Tempo Hire Charges 18% Yes Yes Yes
36 Club & Membership fees 18% Yes Yes No
37 Advertisement Charges / Hoarding / Magazine / News Papers / Media 18% Yes Yes Yes
38 AMC Charges 18% Yes Yes Yes
39 Bank Charges – Service charges recovered 18% Yes No Yes
40 Broker Fee & Charges 18% Yes Yes Yes
41 Cancellation Charges 18% Yes Yes Yes
42 Extended Warranty 18% Yes Yes Yes
43 House Keeping Charges 18% Yes Yes Yes
44 Insurance paid on goods & vechile 18% Yes Yes Yes
45 Health Insurance 18% Yes No No
46 Payment to advocate 18% No Yes Yes
47 Loading & Unloading – others/ Hamali 18% Yes Yes Yes
48 Training Expense 18% Yes Yes Yes
49 Payment to Post office for Speed post & parcel post 18% No Yes Yes
50 Postage and Courier Charges 18% Yes Yes Yes
51 Printing & Stationery (Flex Printing, Broad Printing, Notice Printing) 18% Yes Yes Yes
52 Recruitment Expenses 18% Yes Yes Yes
53 Commission Paid 18% Yes Yes Yes
54 Rent Paid for commercial use of premises 18% Yes Yes Yes
55 Godown Rent for commercial purpose 18% Yes Yes Yes
56 Repair and Maintenance – Building /  Electrical
/  P& M /  Others
18% Yes Yes Refer Note 1
57 Room Rent in a hotel, lodge  (Rs.2500 to 7500 per room per day 18% Yes Yes Yes
58 Payment for Sponsorship Services 18% Yes Yes No
59 Security Charges 18% Yes Yes Yes
60 Telephone, Mobile & internet Charges 18% Yes No Refer Note 2
61 Sundry Expenses 18% Yes Yes Yes
62 Job Work / Labour Charges for garment processing 18% Yes Yes Yes
63 Job Work / Labour Charges (Other) 18% Yes Yes Yes
64 Sitting Fees, Commission or any other payment made to director by company 18% Yes Yes Yes
65 Audit Fees, Account Writing , Professional Fees (other than Advocate) 18% Yes Yes Yes
66 Research & Development Expenses 18% Yes Yes Yes
67 Food & Beverages Expense (AC restaurant) 28% Yes Yes No
68 Wall Paint 28% Yes Yes No
69 Room Rent in a hotel, lodge Above Rs.7500/- 28% Yes Yes Yes
70 Traveling Expenses International 28% Yes Yes No
71 Amusement Park/ Theater Ticket 28% Yes Yes Yes
72 Cold drink 40% Yes Yes No
73 Repairs & maintenance Charges if it has not resulted into immovable property 18% / 28% Yes Yes Yes
74 Electrical Fittings 18% / 28% Yes Yes No
75 Staff Uniform Expenses 5% / 12% Yes Yes Yes
76 Packing material & Packing Charges 5%/ 12% 18% Yes Yes Yes
77 Plant & Machinery Actual Rate Yes Yes Refer Note 3
78 Furniture & Fixture Actual Rate Yes Yes Refer Note 3
79 Motor Car Actual Rate Yes Yes No
80 Building Actual Rate Yes Yes No
81 Office Equipment including Computer, Software & Hardware Actual Rate Yes Yes Refer Note 3
82 Free Gift given to staff (Exempt upto Rs.50000/- per staff p.a) Applicable Rate Yes Yes No
83 Free Gift given to staff (Above Rs.50000/- per staff p.a) Applicable Rate Yes Yes Yes
84 Diwali/ New year Gift purchased & debited to P & L Applicable Rate Yes Yes Yes

Notes:

1)  If repair  & maintenance expenses resulted into immovable property than input credit is not available.

2) If Telephone, Mobile & Internet bill is in the name of the company and address and place of business is mentioned then only one should claim the input credit.

3) Input credit is available fully. However if it is sold/disposed off/ scrapped/ thrown away within 5 years, then input credit @ 5% per quarter is available for the used period and balance is to be reversed for not used fully at the time of date of sale.

4) Input credit is available only if goods & services are used for business. If good or services are used for personal purpose then input credit is not available. If goods & services are used partially for personal use and partially for business use then input credit is available partly in proportion to business use.

5) Input credit is not available if outward supply of goods or services is exempt from payment of tax.

6)  As per Notification No 8/2017 dated 28/06/17, it is provided that if the aggregate value of goods or services or both debited to Trading A/c or expenses debited to Profit & Loss A/c or purchase of any asset obtained from unregistered suppliers is less than Rs.5000/- in a day, then tax is not required to be paid for such inward supplies by the recipient for that particular day.

7)  Details of all purchase of goods or services debited to Trading A/c or purchase of any fixed asset are required to be submitted in GST return whether purchased from registered person or unregistered person or from composition dealer.

8) However, if any expense items are purchased from unregistered supplier & escape the payment of tax in view of Notification No.8/2017 dated 28/06/17 then same are not required to be submitted in GST return.

Author Bio

Qualification: CA in Job / Business
Company: Deepak Kumar & Company
Location: Faridabad, Haryana, IN
Member Since: 18 Sep 2017 | Total Posts: 5
I'M Deepak Kr Gupta From Faridabad-Haryana, My profession is Accounts, Banking Finance, Taxation (Direct-GST), ROC, Labour Law/Payroll, Audit & Other Compliance etc. View Full Profile

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35 responses to “RCM Expenses List under GST”

  1. vijay kumar says:

    maintenance of Canteen for staff tea is eligible for input of GST or Not

  2. Sanjay Kumar says:

    Respected Sir,
    Plz explain easily
    Input credit is available fully. However if it is sold/disposed off/ scrapped/ thrown away within 5 years, then input credit @ 5% per quarter is available for the used period and balance is to be reversed for not used fully at the time of date of sale.

  3. Prakash Thakur says:

    Dear Sir,

    Kindly confirm whether any GST applicable on Salary / of Remuneration to partners in partnership firm, if yes, then what is the rate and is it on RCm basis ?

    Prakash

  4. SHEKHAR R KULKARNI says:

    VERY GOOD. NICE EFFORTS TAKEN. ONE DOUBT THAT INSURANCE OF VEHICLE IS ALLOWED AS ITC. IS IT ALLOWED?

  5. AMIT AGIWAL says:

    On cold drinks Rate of tax is mentioned 40% entry no. 72

    Restaurants are having tax rate 18% while mentioned 28% – Entry no. 67

    RCM is applicable if service provider is unregistered and certain category which are mentioned in act.

  6. Rajesh Jain says:

    Sir, Rent paid for residential use is @ 0%, so, rent paid for premises for residential use for staff is 0% or @ 18%, & if 0%, can be claim under P&L???

  7. CA. S.C.Podder says:

    Good informative . keep it up.

  8. PRABHAKAR says:

    Dear Mr. Deepak basically the coverage of RCM arises when the bill is paid to an un regd dealer. When a bill already suffered gst where is the question of RCM. For ex . Telephone bill, insurance , Ac hotel and restaurents all are giving bill including gst. So where is the question of rcm in such cases. Pl clarify

  9. mnvbk,hnb says:

    where is the note 1

  10. Narendra ku Dash says:

    Thanks for information.nicely discussed
    Regards
    Narendra Ku Dash
    Advocate & Tax Consultant
    Odisha

  11. K K SARAWAGI says:

    Good article on RCM by Deepak Kr Gupta. However, notes are missing. please provide.

  12. SHARNABASWA HARWAL says:

    REFERENCE NOTES ARE MISSING . LIST IS HELPFUL THANKS SIR

  13. Dhaval Doshi says:

    Notes are missing, Please share the notes.

  14. Raj Kumar says:

    Dear Sir,
    Notes not available, kindly provide

  15. Hitesh says:

    Sir,
    In above expense list, expenses below Rs.5,000/- are exempted from GST levy.

  16. Rohan Bhate says:

    Confusion still prevails in case of payment to GTA
    If I pay rcm on payment to Transporter @ 5% then I won’t be allowed ITC??

    Further, what about interest payment to Non Banking Finance Co. whether GST under rcm to be paid to them?

  17. Balagopal says:

    Dear Gupta ji, Very informative post indeed. But the Notes are missing for readers to fully understand it. Please advise the type of items covered in “Travelling expenses – International”. Thanks.

  18. CA D.C.SINGHVI says:

    What is meaning of input credit allowable. Is it not correct that you have to book the liability first for RCM and then claim input on he tax deposited by the dealer. Meaning thereby, that RCM is neutrlised and it is bookes as expenditure. Kindly clear this point. Like job work of textiles. One got the job work from unregistered dealer under GST and the dealer has to pay RCM. Is that dealer is not required to pay tax by RCM mechanism on Jobwork and adjust the payment by way of input tax on the tax deposited on jobwork.

  19. R.Mukherjee says:

    It is just fantastic. But Note1,2,3 not found.
    Please send the same

  20. kamal says:

    Deepak ji

    It is very helpful, i wanted to change /add less according to my clients so can u send me this on cakamalmall@gmail.com

  21. rktcalcutta@gmail.com says:

    Dear Deepakji,
    Very useful post. But Note 1, 2 & 3 is not visible on the post. Would you be kind enough to post full post or Note 1, 2 & 3 on my email ID to RKTCALCUTTA@GMAIL.COM.

  22. RAJ KUMAR says:

    Sir,

    Expenses list under GST is very much helpful.But refer Note 1,2 and 3 are not available. Kindly provide these.

  23. Mahendra says:

    As per section 17(5) articels distributed as free gifts then ITC is not available point number 83 & 84, correct me if i am wrong.

  24. S SoumyaRanjan says:

    Notes details should be provided. Its very good article.

  25. VENEET ARORA says:

    What will be the practice if we take service from a tractor wala who not falls under Goods transport agency but works independently and does not give any invoice to the service receipent. Will That expence fall under 5000/- per day expence limit or will it fall under compulsary taxable service under Rcm.

  26. priya kadam says:

    Thanks for information
    it is very useful. all confusion regarding RCM is cleared now.

  27. V. SUBRAHMANYAM says:

    THANKS FOR THE INFORMATION GIVEN IN YOUR ARTICLE IT IS USEFUL ALL REVERSE CHARGE PAID TAX PAYERS.

  28. Ugan Gupta says:

    Please upload refer note which you have mention above.

  29. Bhaskar Kumar Roy says:

    Please provide note details

  30. R. Jayakumar says:

    Sir
    Kindly explain that you have mentioned Refer note 1,2,3. i need the details of Refer note

  31. R K MAHARIWAL says:

    PLEASE MENTION THE GST RATE ON SUPPLY OF MOTOR VEHICLE TO COMPANY AND/OR ANY EDUCATIONAL INSTITUTE (PICK UP THE STAFF FROM RAILWAY/BUS STATION AND DROP AT THE THEIR PREMISES AND VISE VERSA)
    THE CONTRACT IS MONTHLY BASIS AND TDS ARE DEDUCTED AT APPLICABLE RATE
    1 THE SERVICE PROVIDER IS OWNER OF THE MOTOR VEHICLE AND INPUT CREDIT TAKEN
    2 THE SERVICE PROVIDER IS OWNER OF THE MOTOR VEHICLE AND NO INPUT CREDIT TAKEN
    3 THE SERVICE PROVIDER IS TAKEN THE MOTOR VEHICLE ON RENT BASIS AND CAN SERVICE PROVIDER TAKE INPUT CREDIT
    4 THE SERVICE PROVIDER IS TAKEN THE MOTOR VEHICLE ON RENT BASIS AND IF SERVICE PROVIDER WILL NOT TAKE INPUT CREDIT

  32. Praveen says:

    Referring notes are missing, pl provide the same.

  33. PPV SANTANAM says:

    Dear Deepak
    Please provide Notes details as you referred in the chart. Also enlighten two rates mentioned in the certain cases Ex.Uniform Allowance to employees.

  34. PHANI says:

    Reference notes are missing

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