| S. No. | Situation | Payment Terms | Input Tax Credit Allowability |
|---|---|---|---|
| 1. | Where Goods Transport Agency is Registered – GST on Freight shall be charged at 5%. | Pay Tax under reverse charge as per bill of Goods Transport Agency | ITC with respect to 5% paid to the transporter shall be eligible. |
| 2. | Where Goods Transport Agency is Unregistered (where the bill exceeds Rs. 5,000 in a day). | 1. Procure a declaration from the transporter whether he is a GTA or Not? 2. In Case of GTA- Reverse charge at the rate of 5% (Procure declaration from him that he shall not be claiming any Input tax Credit) 3. Where the person is not GTA or he disagrees to give a certificate for non-availing of ITC deposit tax under Reverse Charge at the rate of 18%. | Full Input Credit of Tax paid (whether 5% or 18%). |
| 3. | Your company charges freight to its customer (Presuming that the company is not a GTA) and the freight is not included in the unit price. | Charge GST on the invoice value at the rates applicable to the goods being transported. (Composite Supply). | Full ITC available to Recipient |
| 4. | Your company charges freight to its customer (Presuming that the company is not a GTA) and the freight is included in the unit price. | Charge GST on the invoice value at the rates applicable to the goods being transported. (Composite Supply) | Full ITC available to Recipient |
| 5. | Where I am purchasing exempted goods and the registered transporter charges 5% on its invoice. | Pay 5% to the Transporter under Reverse Charge Mechanism. (Registration shall be compulsory) | No Input tax Credit shall be eligible. |
| 6. | Where I am purchasing exempted goods and the transporter is unregistered | —-Same as S. No. 2—– | No Input tax Credit shall be eligible. |
| 7. | Where your company raises separate invoice for freight | No GST as per Notification 12/2017 entry No. 18 |
| The person who pays or is liable to pay freight for the transportation of goods by road in goods carriage, located in the taxable territory shall be treated as the person who receives the service for the purpose of this notification. |
