TAX COLLECTED AT SOURCE GOODS & SERVICES TAX TAX COLLECTED AT SOURCE

TAX COLLECTED AT SOURCE Section 52 of the CGST Act Relevant Rules/Notification yet to be issued. Saturday, February 23, 2019Saturday, February 23, 2019

E -Commerce Operator (U/s 52) Definitions U/s 2 of CGST Act “Electronic commerce” means the supply of goods and/or services including digital products over digital /electronic network.  “Electronic commerce operator” means any person who owns/operates/manages digital or electronic facility or platform for electronic commerce. Saturday, February 23, 2019Saturday, February 23, 2019

Provisions U/s 52(1) of the CGST Act Every Electronic Commerce Operator not an agent shall Collect an amount at rate not exceeding 1%. (As per Govt notifications on Council recommendations) On net value of taxable supplies made through it. Where consideration for supplies collected by the operator. Non- compliance of the provisions may entail penalty of Rs. 10000/- or the amount of TCS involved whichever is higher. Saturday, February 23, 2019Saturday, February 23, 2019

Value of Taxable Supplies “Net Value of Taxable Supplies” in a month -- Aggregate Value of Taxable supplies of Goods and/or Services in a month Less Services notified U/s(9)(5) Aggregate Value of Taxable Supplies returned in a month Saturday, February 23, 2019Saturday, February 23, 2019

Procedural Compliances TCS to be deposited by the 10th of the month following the collection. TCS deposited to be reflected in the electronic cash ledger of the supplier and can be used for making any payment on account of GST. Monthly return in GSTR-8 to be filed by 10th of subsequent month – giving details of outward supplies and goods returned in a month along- with details of TCS collected. Monthly return details for a financial year to be furnished in the annual return in GSTR Form 9B filed for such financial year by 31st December. Return furnished by the e-commerce operator to be matched with the return of outward supplies of the supplier. Saturday, February 23, 2019Saturday, February 23, 2019

Power to requisition information Proper officer empowered to require via a notice to furnish prescribed information including the supplies made and information on stock of goods held. Non compliance of information requisitioned within specified period in notice served may entail penalty which may extend to Rs. 25000/- Saturday, February 23, 2019Saturday, February 23, 2019

Concerns The explanation in Sec 52(1) for “net value of taxable supplies” doesn’t clarify that the value of goods will be inclusive of GST or not. If included this will lead to a cascading effect. E-Commerce Operator to face compliance burden. Will affect small companies with compliance burden as both operator and supplier will have to maintain records, specially the operators who have to keep record for thousands of suppliers. Saturday, February 23, 2019Saturday, February 23, 2019