GLOBAL TAX PLANNINNG

Reverse Charge Mechanism (RCM) on job work services supplied by an unregistered person (job worker) to a registered person (principal) under the GST law . ⚖️ 1. Legal Provision Under Section 9(4) of the CGST Act, 2017 and the relevant notifications , the general rule is that supplies from an unregistered person to a registered person are not taxable under RCM , except when specifically notified. However, job work has a special rule : Notification No. 13/2017 – Central Tax (Rate) dated 28.06.2017 , specifies “Services by way of job work” supplied by an unregistered person to a registered person as taxable under RCM . 👉 Therefore: If an unregistered job worker provides job work service to a registered principal → RCM applies. 🧾 2. Who Pays GST under RCM? Party Registration Status RCM Applicability Who Pays GST Principal (recipient) Registered ✅ Yes Principal Job worker (supplier) Unregistered ✅ Covered – The principal (registered supp...

Job Work Services on Garments in detail under GST law , including definition, rate, documentation, and compliance 👇 👕 1. Meaning — Job Work on Garments When a person (job worker) performs stitching, dyeing, printing, embroidery, finishing, washing, or packing on garments or textile fabrics belonging to another registered person , it is job work service as per: Section 2(68) of CGST Act, 2017 Job work means any treatment or process undertaken by a person on goods belonging to another registered person. So, garment job work = supply of service , not goods. ⚙️ 2. GST Classification & SAC Code Nature of Job Work SAC Code Description GST Rate Job work in relation to textiles, garments, apparel, fabrics, yarn, etc. 9988 (specifically 9988 13) Services by way of job work in relation to textile yarns, fabrics, and wearing apparel 5% (CGST 2.5% + SGST 2.5%) Job work in other goods (metal, machinery, etc.) 9988 19 / 9988 90 Other manufacturing services ...