Time of Supply in GST

Time of supply is that event in which month liability to pay tax arise.

WHAT IS TIME OF SUPPLY ?

The liability to pay the goods and services tax arises only when a supply has been made.

The time of supply fixes liability has be discharged.

The time of supply is the time when a supply of goods and / or services is treated as being made under the GST law. It is important to determine the time of supply because a taxable person should charge GST at the time when the supply is made / deemed to have been made. A supplier becomes liable to account for GST once a tax point has occurred and must include it in the return covering the period in which it falls. The time of supply differs for supply of goods and supply of services. This is because goods are tangible and involve physical movement / removal or transport whereas services are intangible that involve performance, for making supply.

TIME OF SUPPLY OF GOODS UNDER SECTION 12 OF CGST ACT, 2017

TIME OF SUPPLY- GOODS

Time of supply shall be earlier of following dates :

1. Date of issuance invoice or of by supplier

2. Last date on which supplier required to issue of invoice u/s 31(1) { at the time of removal of goods, where movement involve or delivery of goods or making available to recipient in any other case or

3. Date on which supplier receive the payment for supply (except if supplier receives an amount up to Rs 1000/- in excess of amount shown in tax invoice, Time of supply shall be at option of supplier be date of issue of tax invoice)

Note-1 Date of payment, shall be date on which entered in books of account or payment credited to his bank account, which ever is earlier.

EXAMPLE

A. Raman Ltd. made supply of goods to Taj hotel of Rs 10,00,000/-.
Date of Removal of goods 15-05-2017
Date of payment 10-05-2017 500,000/-.
10 05 of Rs 500,000/ .
Date of issue of invoice 16-05-2017

Ans:
1. Time of supply shall be 10-05-2017 for Rs 5,00,000/-
2. Time of supply for rest shall be earlier of
date of removal 15-05-2017 or date of invoice 16-05-2017
Hence, date 15-05-2017 for rest amount of Rs 5,00,000/-

EXAMPLE

B. Raman Ltd. entered into supply of furniture to Taj hotel of Rs 10,00,000/-. Furniture is to remove in parts & final assembly shall take at client site.
Date of Removal of goods 15-05-2017, 18-05-2017 & 20-05-2017 and finally
made available on 23-05-2017
Date of payment 30-05-2017 of Rs 10,00,000/-.
Date of issue of invoice 22-05-2017

Ans:
1. Time of supply shall be earlier of date of issue of invoice 22-05-2017 or when goods made available to recipient on 23-05-2017. So date will be 22-05-2017.

EXAMPLE

B. Raman Ltd. purchase goods from ATL, billed of Rs 10,000/-. Dated 25.5.2017, but payment made of Rs 11,000/- to ATL. How to deal for Rs 1,000/- excess received by ATL.

Ans:
1. As per proviso to time of supply, ATL may pay GST on Rs 1,000/- when he shall issue next billing cycle.

TIME OF SUPPLY REVERSE UNDER CHARGE U/S 12(3) OF CGST ACT, 2017

Time of supply shall be earlier of following:

1. Date of receipt of goods

2. Date of payment entered into books of account or credited in to his bank account

3. Date immediately following thirty days from date of issue of invoice or any other document. For example, Invoice date 15.5.2017 then after expiry of 30 days 14.6.2017 then time of supply will be 15.6.2017.

Exception: If time of supply is not determinable as per point 1,2 & 3 then time of supply shall be date of entry in books of account of recipient.

WHAT IS TIME OF SUPPLY VOUCHERS

Time of supply shall be

1. If supply is identifiable at that point, date of issue of vouchers, or

2. Date of redemption of vouchers

TIME OF SUPPLY IF NOT POSSIBLE TO DETERMINE AS SPECIFIC PROVISIONS

Time of supply shall be

1. Where periodical return has to be file, Due date of filing of return.

2 In any other case, date on which tax is paid

TIME OF SUPPLY, INTEREST, LATE FEE OR PENALTY FOR DELAYED PAYMENT

Time of supply shall be

1. Date on which supplier receive such addition in value.

TIME OF SUPPLY OF SERVICES U/S 13 OF CGST ACT, 2017

TIME OF SUPPLY -GENERALLY

Time of supply of services shall be earliest of the following

1. Date of issue of invoice, if issued within specified time u/s 31(2) read with is days for relevant rules 30 days or 45 Insurance, Banking & NBFC from date of supply, or

2. Date of receipt of payment, or

3. Date of provision of service if invoice not issued within specified time.

If time not ascertainable from above, then date on which recipient shows receipt of services in his books of account.

Exception: If supplier receive an amount up to Rs 1000/- over & above as indicated in tax invoice then time of supply shall be at the option of supplier when he issue subsequent invoice.

Note: Date of receipt of payment shall be date on which payment entered in books of account or date of credited into bank account, which ever is earlier.

TIME OF SUPPLY UNDER REVERSE CHARGE

Time of supply shall be earliest of the following;

1. Date on which payment entered in books of account

2. Date which payment on debited in his bank account

3. Date immediately following 60 days from date of issue of invoice

If same is not ascertainable, the date of entry in books of account.

In case of supply by associated enterprises, where supplier located outside India, time of supply shall be earlier of :-

date of entry in books of account of recipient of supply or date of payment.

TIME OF SUPPLY IN CASE OF CHANGE IN RATE

TIME OF SUPPLY IN CASE OF CHANGE IN RATE OF TAX IN RESPECT OF GOODS OR SERVICES