Goods Transport Agency (GTA) plays a significant role in Logistic Sector who provide the service for transporting of goods.
In the GST regime, the taxability of the service provided by the Goods Transport Agency (GTA) depends on various factors. It includes whether GST to be paid in Forward Charge or in Reverse Charge.
The below section helps you check your requirement on GST of Goods Transport Agency.
GST Flowchart for Goods Transport Agencies (GTA)
(Use 'Desktop Site' on Mobile)
START: Is a Consignment Note Issued?
Key Notes:
- Consignment note is crucial for GTA classification & GST application.
- Input Tax Credit (ITC): Available only if GTA pays GST at 12%.
- Exemptions mainly for essential goods and low-value consignments.
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Threshold for exemption:
- If the freight charge for a single carriage is ₹1,500 or less (irrespective of the number of consignors/consignees)
- If the freight charge for a single consignee in a single carriage is ₹750 or less
- If the freight charge is above these amounts, it is considered "above threshold" and GST applies.
- Essential Goods Include:
- Agricultural produce
- Milk
- Salt
- Food grains
- Organic manure
- Newspapers and magazines
- Relief materials
- Defense equipment
- Specified Category of Recipients liable to pay GST under Reverse Charge Mechanism (RCM):
- Factory registered under the Factories Act
- Society registered under the Societies Registration Act
- Co-operative society
- Registered person under GST (including firms, companies, LLPs, proprietorships, etc.)
- Partnership firms, associations of persons, trusts, and local authorities
- Most commercial/general goods are taxable depending on the mode and type.
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GST Payment by Supplier or Recipient:
Who Pays When Applied GST Rate Input Tax Credit (ITC) Notes Supplier (GTA) If opted for forward charge at start of FY 5% (No ITC) or 12% (With ITC) Yes (only at 12%) GTA must opt at beginning of financial year and invoice accordingly Recipient (RCM) When recipient is a specified category (registered persons, factories, societies, etc.) AND GTA has not opted for 12% forward charge 5% Recipient can claim ITC; GTA cannot Recipient pays GST directly under Reverse Charge Mechanism * Either supplier or recipient pays GST, not both for the same supply.