Daily Archives: August 22, 2017

GST Treatment if gold issued to Job Worker

Question 8: When we issue gold as raw material to our Job Worker for Job Work and he returns that gold as finished goods,what GST treatment will be done and how to calculate the value? Answer: The job worker, if registered, would be required to pay GST at the rate of 5% on job charges… Read More »

Category: GST

GST Rate on sale of Gold if making charge shown separately

  Question 7: When we are selling Gold, Diamond or Silver Jewellery to the end consumer (Customer) like a Gold Chain weighing 10 gm at a total value of Rs. 30,000/- (gold value is Rs. 28000/- and making charges on that gold chain is Rs 2000/-), can we charge GST @3% on the total value… Read More »

Category: GST

Refund of Excess GST paid by Banks on Gold

Question 6: Banks pay provisional VAT currently at the time of delivery of gold on the basis of ongoing market prices. When customer fixes the price of metal, Banks pay actual VAT on the maturity date of the Gold Loan. Banks must be allowed to set-off the excess provisional GST paid to the government against… Read More »

Category: GST

Pay GST on Provisional Basis on lending of Gold

  Question 5: Banks lend gold in physical form for a period not exceeding 6 months. Banks receive interest on the gold ounces disbursed and the same is converted into Rupees after calculation of interest on the ounces and the USD/INR conversion. Will the same methodology continue in case of GST as well wherein Banks… Read More »

Category: GST

GST Rate on Gold & Silver laying in Stock on 1st Juy 2017

Question 4: Gold and silver imported by banks/nominated agencies on consignment basis are lying in stock as on 1st July. Clarification is required on how to charge the customers in transition phase from VAT to GST. Will customers be liable to pay GST rates? Answer: GST is payable @ 3% with effect from 01.07.2017.  … Read More »

Category: GST

Ownership not relevant for Paying IGST on Import Material

Question 3: Banks import gold / silver on consignment basis wherein the ownership of the metal is with the supplier of the bullion which maybe an overseas entity. Is the overseas entity required to have GST registration because currently they do not file returns and are governed by multi-nation treaties? Answer: This amounts to an… Read More »

Category: GST

Pay 3% IGST on Import of precious metals

Question 2: Currently Banks do not pay any VAT on import of precious metals. Banks/nominated agencies pay only customs duty on imports. In the new regime of GST, will the Banks have to pay IGST while importing? Answer: Yes, 3% IGST is payable on all imports of precious metals in addition to the basic customs… Read More »

Category: GST

GST on advertising material to distributors

Question 1: Whether advertising and communication material (banners / hoardings / posters) provided to distributors would be treated as supply in the course of business by the company thereby not requiring any reversal of ITC under GST Act . Answer: (a) Where the material is provided free of cost: This would not amount to a… Read More »

Category: GST

GST on Gems & Jewellery : FAQ

GST on Gems & Jewellery Question 1: Whether advertising and communication material (banners / hoardings / posters) provided to distributors would be treated as supply in the course of business by the company thereby not requiring any reversal of ITC. Answer: (a) Where the material is provided free of cost: This would not amount to… Read More »

Banks to pay 3% IGST on imports of gold, precious metals: CBEC

Banks importing gold and precious metals will have to pay 3 per cent tax under goods and services tax (GST), which can be claimed as input tax credit, the government has said. Clarifying issues on GST on gems and jewellery through frequently asked questions (FAQs), the Central Board of Excise and Customs (CBEC) said banks… Read More »

When should Govt department Take GST registration

Question 31: Whether a Government Department, required to deduct tax at source, is liable to take registration as a normal taxpayer? Answer: The Government Department is required to take registration as a normal taxpayer only if it makes a taxable supply of goods and/or services and in such cases, the registration shall be obtained on… Read More »

Category: GST

Treatment of TDS deducted under GST for payment of Output Tax

Question 29: Whether the deductee can claim the input tax credit on the deduction of tax at source amount? Answer: No. The tax deducted at source is not input tax credit. However, the amount deducted shall be credited to the electronic cash ledger (upon being accepted by the deducteein his Form GSTR-2A) of the deductee… Read More »

Category: GST

What is concept called ‘ tax deduction at source ‘ under GST

Question 28: What is the concept called ‘ tax deduction at source ’? Answer: As per section 51 of the CGST Act, 2017, the Government may mandate (a) a department or establishment of the Central Government or State Government; or (b) local authority; or (c) Governmental agencies; or (d) such persons or category of persons… Read More »

Category: GST

GST on supply of motor vehicles on hire to Government Departments

Question 26: Would services in relation to supply of motor vehicles to Government be taxable under GST ? Answer: Supply of a motor vehicle meant to carry more than twelve passengers by way of giving on hire to a state transport undertaking is exempted from tax. The exemption is applicable to services provided to state… Read More »

Category: GST

GST on Reverse Charge basis on Services received from Govt / local authorities

Question 24: Whether reverse charge is applicable to services provided by Government or local authorities ? Answer: Yes, reverse charge is applicable in respect of services provided by Government or local authorities to any person whose turnover exceeds Rs.20 lakhs (Rs.10 lakhs for Special Category States) excluding the following services: (i) renting of immovable property;… Read More »

Category: GST

What is reverse charge in GST ?

  Question 23: What is reverse charge in GST ? Answer: As per 2(98) of the CGST Act, 2017, ‘’reverse charge” means the liability to pay tax by the recipient of supply of goods or services or both instead of the supplier of such goods or services or both under sub-section (3) or sub-section (4)… Read More »

Category: GST

GST on services received from Govt : Turnover Limit

Question 22: A small business entity is carrying on a business relating to consulting engineer services in Delhi. Does it need to pay tax (under GST) on the services received from Government or a local authority? Answer: If turnover of the entity is less than the limit of Rs. 20 lakhs in a financial year,… Read More »

Category: GST

GST on Services by Govt / Local Authority in special category States

Question 21: Whether services provided by Government or a local authority to a business entity located in a special category State are subject to tax? Answer: The expression “special category States” provided in Explanation (iii) to section 22 of the CGST Act, shall mean the States as specified in sub-clause (g) of clause (4) of… Read More »

Category: GST

No GST on fines and penalty imposed by Government / local authority

Question 20: Whether fines and penalty imposed by Government or a local authority for violation of a statute, bye- laws, rules or regulations liable to tax under GST ? Answer: No. This gets covered under the exemption by way of tolerating non-performance of a contract for which consideration in the form of fines or liquidated… Read More »

Category: GST

No GST on Change of Land use , commercial building approval & utility services by Govt

  Question 19: Whether services in the nature of change of land use, commercial building approval, utility services provided by a governmental authority are taxable? Answer: Regulation of land-use, construction of buildings and other services listed in the Twelfth Schedule to the Constitution which have been entrusted to Municipalities under Article 243W of the Constitution, when… Read More »

Category: GST

Functions of Panchayat under Article 243G of Constitution ?

Question 17: What are the functions entrusted to a Panchayat under Article 243G of the Constitution? Answer: The functions entrusted to a Panchayat under the Eleventh Schedule to Article 243G of the Constitution are as under: (i) Agriculture, including agricultural extension. (ii) Land improvement, implementation of land reforms, land consolidation and soil conservation. (iii) Minor… Read More »

Category: GST

Functions of municipality under Article 243W of Constitution

Question 16: What are the functions entrusted to a municipality under Article 243W of the Constitution Answer: The functions entrusted to a municipality under the Twelfth Schedule to Article 243W of the Constitution are as under: (a) Urban planning including town planning. (b) Regulation of land-use and construction of buildings. (c) Planning for economic and… Read More »