Hello friends greetings for the day in the current article we will discuss time of supply of service under normal charge and under reverse charge mechanism. Time of supply is very important topic as it will determine, when liability to pay tax on service shall arise.
According to section 13 of CGST Act 2017, the liability to pay tax on service shall arise at the time of supply as determined in accordance with the provisions of this section
As per sec 13(2) of CGST Act the time of supply of service shall be the earliest of the following dates:-
In case the where the above clause do not apply then the date on which the recipient shows the receipt of service in his books of accounts. The supply shall be deemed to have been made to the extent it is covered by the invoice or as the case may be , the payment.
Provided that where the supplier of taxable service receives an amount upto one thousand rupees in excess of the amount indicated in tax invoice, then the time of supply to the extent of such excess amount shall , at the option of the said supplier be the date of issue of invoice relating to such excess amount. It means that if any excess amount is received from the recipient upto the limit of 1000 per person then instead of paying the tax liability on advance it can be settled in next recurring bill and GST would be paid accordingly.
As per 13(3) of CGST Act 2017, in case of supplies in respect of which tax is paid or is liable to be paid on reverse charge basis, the time of supply shall be the earlier of the following namely:-
Provided that where it is not possible to determine the time of supply under the above clause then the time of supply shall be the date of entry in the books of account of the recipient of supply.
Provided further that in case of supply by associated enterprise, where the supplier of service is located outside India, the time of supply shall be the date of entry in the books of account of the recipient of supply or the date of payment whichever is earlier.
In case of supply of vouchers by a supplier the time of supply shall be:-
Where it is not possible to determine the time of supply under the above provisions then the time of supply shall be:-
The time of supply to the extent it relates to an addition in the value of supply by way of interest, late fees or penalty for delayed payment of any consideration shall be the date on which the supplier receives such addition in value.
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