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TMI BlogReverse Charge Mechanism (RCM) on renting of motor vehiclesX X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioners/ Commissioner of Central Tax (All) / The Principal Director Generals/ Director Generals (All) Madam/Sir, Subject- Reverse Charge Mechanism (RCM) on renting of motor vehicles -reg. Suppliers of service by way of renting of any motor vehicle designed to carry passengers where the cost of fuel is included in the consideration charged from the service recipient have an option to pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a motor vehicle provided to a body corporate. Any person other than a body corporate, paying central tax at the rate of 2.5% on renting of motor vehicles with input tax credit only of input service in the same line of business Any body corporate located in the taxable territory. 3. Post issuance of the notification, references have been received stating that when a service is covered by RCM, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t shall not be liable to pay GST under RCM; and, (ii) where the supplier of the service doesn't charge GST @ 12% from the service recipient, the service recipient shall be liable to pay GST under RCM. 5. Though a supplier providing the service to a body corporate under RCM may still be paying GST @ 5% on the services supplied to other non body corporate clients, to bring in greater clarity, ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, as any other interpretation shall render the RCM notification for the said service unworkable for that period which is not permissible in law.
7. Difficulty if any, in the implementation of this Circular may be brought to the notice of the Board.
Yours Faithfully,
(Rachna)
OSD, TRU
Email: [email protected]
Tel: 011 2309 5558 X X X X Extracts X X X X X X X X Extracts X X X X
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