Does aggregate turnover include value of inward supplies received on which RCM is payable?
This post finds whether aggregate turnover includes value of inward supplies received on which RCM is payable.
What is Aggregate turnover?
According to section 2(6) of the Central Goods and Services Tax (CGST) Act, 2017, unless the context otherwise requires, the term “aggregate turnover” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess.
What is RCM?
RCM means Reverse Charge Mechanism. In case of unregistered dealer is supplying goods to the registered dealer, then the liability to pay tax shifts on the registered dealer i.e. the recipient of goods, where such supply is of taxable supplies. There is no reverse charge mechanism in case of exempted supplies.
Now, let us come back to the question - Does aggregate turnover include value of inward supplies received on which RCM is payable?
Refer Section 2(6) of CGST Act. Aggregate turnover does not include value of inward supplies on which tax is payable on reverse charge basis.
The above information explains on RCM payable and Aggregate turnover under GST. Would you like to add more information about RCM payable and Aggregate turnover under GST? Share below your thoughts:
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