Introduction

The Ministry of Finance free notification on twenty-sixth July 2018 that seeks to amend the Integrated Tax(rate) underneath the Integrated product and Services Act, 2017. The notification essentially specifies that RCM on services by individual DSAs to banks/NBFCs are going to be taxed. What this entails is that the services provided by DSAs (Direct mercantilism Agents) of banks or NBFCs are going to be charged underneath RCM (Reverse Charge Mechanism).

What is the Reverse Charge Mechanism you would possibly ask! Well, it essentially suggests that a system wherever the recipient of products or services has got to pay the tax rather than the provider. RCM is an element of GST rules. Below we tend to provide a representation of the Reverse Charge Mechanism.

CM on serviced by individual DSAs

RCM maintained by individual DSAs of banks /NBFCs will soon be imposed.

Provisions of RCM on services by Individual DSAs

The notification essentially adds the subsequent amendments.

Including DSAs of Banks/NBFCs within the rateable territory underneath Reverse Charge Mechanism
Explanation of ‘renting of unmovable property’
You can additionally refer the official notification from the Ministry for your convenience.

Government of Republic of India
Ministry of Finance
(Department of Revenue)
New Delhi

Notification No. 16/2018-Integrated Tax (Rate), Dated: twenty sixth July 2018
G.S.R. 684(E).- In exercise of the powers bestowed by sub-section (3) of section five of the Integrated product and Services Tax Act, 2017 (13 of 2017), the Central Government, on the recommendations of the Council, herewith makes the subsequent any amendments within the notification of the govt of Republic of India, within the Ministry of Finance (Department of Revenue), notification No. 10/2017- Integrated Tax (Rate), dated the twenty eighth June 2017, printed within the Gazette of Republic of India, Extraordinary, Part II, Section 3, Sub-section (i), vide range G.S.R. 685(E), dated the twenty eighth June 2017, namely:-

Notification No. 16/2018-Integrated Tax (Rate), Date 26th July 2018

(i) within the Table, when serial range twelve and therefore the entries relating to that, the subsequent serial range and entries shall be inserted, namely: –

(1) (2) (3) (4)
“13 Services provided by individual Direct mercantilism Agents (DSAs) aside from a body company, partnership or indebtedness partnership firm
to the bank or non-banking monetary company
(NBFCs) Individual Direct mercantilism Agents (DSAs) aside from a body company, partnership or restricted
liability partnership firm. A {banking depository monetary financial organization or a non-banking financial company, set within the rateable territory.”;
(ii) within the rationalization, when clause (f), the subsequent clause shall be inserted, namely: –

`(g) “renting of unmovable property” suggests that permitting, allowing or granting access, entry, occupation, use or any such facility, completely or partially, in AN unmovable property, with or while not the transfer of possession or management of the aforementioned unmovable property and includes belongings, leasing, licensing or different similar arrangements in respect of unmovable property.’.

2. This notification shall inherit force with impact from twenty seventh of July, 2018.

[F. No. 354/13/2018- TRU]

(Gunjan Kumar Verma)

Under Secretary to the govt of Republic of India

Note: -The principal notification No. 10/2017- Integrated Tax (Rate), dated the twenty eighth June 2017 was printed within the Gazette of Republic of India, Extraordinary, vide range G.S.R. 685 (E), dated the twenty eighth June, 2017 and was last amended by notification No. 3/2018 – Integrated Tax (Rate), dated the twenty fifth January, 2018 vide range G.S.R. 71 (E), dated the twenty fifth January 2018.

(1)(2)(3)(4)
“13Services provided by different Direct Selling Agents (DSAs) other than a body corporate, partnership or limited liability partnership firm to the bank or non-banking financial company that is NBFCsIndividual Direct Selling Agents (DSAs) different from a body corporate, partnership, or LLP.A banking company or a non-banking financial company, established in the taxable territory.”;

 

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