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Time of supply or as earlier as it was the point of taxation is a process which is used to determine the point of time, when tax is required to be paid on supply of goods or services. Section 12-14 of the CGST act contains provisions to determine the time of supply.
Discussions made:
Table of Contents
Forward Charge i.e. Tax payable by Supplier (1.07.2017-12.10.2017)
Earlier of the following dates: the date on which invoice is issued by the supplier or the date on which he is required to issue the invoice i.e. due date of Invoice or last date the date of receipt of payment The date of receipt of payment shall earlier of the date when the supplier enters the payment in his books of accounts or on the date on which the payment is credited to his bank account.
Forward Charge i.e. Tax payable by Supplier (13.10.2017-14.11.2017)
Earlier of the following dates: the date on which invoice is issued by the supplier or the date on which he is required to issue the invoice i.e. due date of Invoice or last date the date of receipt of payment Point no. (c) will not be applicable if the taxpayer has not opted for Composition Scheme (Notification no. 66/2017) The date of receipt of payment shall earlier of the date when the supplier enters the payment in his books of accounts or on the date on which the payment is credited to his bank account. In case the turnover is less than 1.5 Crores, No GST on Advance.
Forward Charge i.e. Tax payable by Supplier (15.11.2017 Onwards)
Earlier of the following dates: the date on which invoice is issued by the supplier or the date on which he is required to issue the invoice i.e. due date of Invoice or last date It Simply means no GST on Advance in case of Supply of Goods irrespective of turnover.
Reverse Charge Mechanism
Earliest of the following dates: the date when goods are received or the date when payment is entered in the books of account of the recipient or the date when payment is debited in his bank account, whichever is earlier or31st day i.e. day after 30th day from the date on which invoice is issued or any other document If it is not possible to determine the time of supply in respect of supplies under Reverse Charge Mechanism, the time of supply in such case shall be the date of entry in the books of account of the recipient.
Forward Charge- Invoice is issued within the prescribed period
Earliest of the following dates: the date on which invoice is issued by the supplier or date on which the payment is entered by the supplier in his books of account or date of credit of payment to his bank account
Forward Charge- Invoice is not issued within prescribed period
Earliest of the following dates: the date of provision of service or date on which the payment is entered by the supplier in his books of account or date of credit of payment to his bank account.
If above events are not ascertainable
The date receipt of services as shown by the recipient in his books of accounts
Earlier of the following dates: the date on which payment is entered in the books of account of the recipient or the date of debit of payment is debited in his bank account or61st day i.e day after 60th day from the date on which invoice is issued If it is not possible to determine the time of supply, the time of supply shall be the date on which entry is made in the books of account of the recipient.
Import of Service from AEs
the date on which entry is made in the books of account of the recipient of supply or the date of payment, whichever is earlier. (AEs – Associated Enterprises)
After change
The date on which payment is received or date on which invoice is issued whichever is earlier
Date of receipt of payment
Before change
date of receipt of payment
date of issue of invoice
In such case time of supply shall be:
Supply is Identifiable
Date on which voucher is issued
All other cases
Date on which voucher is redeemed
In cases where time of supply cannot be determined, it shall be:
If periodical return is filed
Date of filing of return
In any other case
Date of payment of tax
Unable to determine Time of Supply
Where there is a need to file a periodical return, the date on which such return is to be filed will be the time of supply or in any other case, the date of payment of tax.
Petty Payments
Where the supplier receives an amount which is at least Rs 1000/- more than the amount indicated in the tax invoice, the time of supply in respect of such excess amount at the option of the said supplier shall be the date on which invoice is issued.
Vouchers
If it is possible to identify the supply at that point, the date on which voucher is issued will be the time of supply orIn all other cases it will be the date on which voucher is redeemed.
Interest, late fee or penalty
Date of receipt of such addition in value by the supplier
By understanding the above-mentioned provisions, one can determine the point of taxation or time of supply which will help in determining the due date on which tax needs to be paid. It is very important to determine the correct point of taxation or time of supply so that timely payments of tax are made and any late interest is avoided.
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