GST Applicability under Reverse Charge Mechanism (RCM) on Services and Goods
In the Goods and Services Tax (GST) regime, the Reverse Charge Mechanism (RCM) shifts the tax liability from the supplier to the recipient of goods or services. Unlike the regular forward charge, where the supplier is liable to pay GST, under RCM, the recipient is required to pay the applicable GST directly to the government. RCM is governed by Section 9(3), 9(4), and 9(5) of the Central Goods and Services Tax Act, 2017 (CGST Act) for intra-state supplies and Section 5(3), 5(4), and 5(5) of the Integrated Goods and Services Tax Act, 2017 (IGST Act) for inter-state supplies.
