Goods Transport Agency under GST – Rate Exemption and returns
A simple overview of the Goods Transport Agency under GST
Hello. In this post, We will discuss the Goods Transport Agency under GST. In which the following topics will be discussed:
- What is GTA?
- What is a Consignment note ?
- Services provided by GTA
- Exemptions Under GST for GTA
- Rate of GST for GTA
- Registration requirement for GTA service providers
- Persons liable to pay GST on GTA services
- Invoicing for GTA
- Place of Supply for GTA
- Payment of Tax by a GTA
- Returns to be filled by GTA
What is GTA?
According to Notification No. 11/2017-Central Tax (Rate) dated 28th June, 2017, the term “goods delivery agency” (GTA) refers to anyone who provides services in connection with the transportation and delivery of goods by road.
Therefore, only those issuing a consignment note are considered to be GTAs, while others may hire out vehicles for goods transportation. As a result, a consignment note is required in order to qualify as a GTA.
What is a Consignment note ?
In a goods carriage, a consignment note is a document issued by a goods transportation agency against the receipt of goods. In the absence of a consignment note, the service provider is not considered a goods transport agency.
When a consignment note is issued, the transporter becomes the new owner of the items’ lien. The products are now the responsibility of the carrier until they are delivered safely to the consignee.
A consignment note has a serial number and includes the following:
- Name of consignor
- Name of consignee
- Registration number of the vehicle used to deliver the goods
- Information about the item
- Origin and destination locations
- Person who must pay GST – consignor, consignee, or the GTA.
Services provided by GTA
The service includes intermediate/ancillary service along with actual transportation of goods, such as-
- Loading/unloading
- Packing/ unpacking
- Trans-shipment
- Temporary warehousing etc.
Exemptions Under GST for GTA
Services by way of transportation of goods :
- By road except for the services of
- a goods transport agency
- a courier agency
- By inland waterways
Rate of GST for GTA
| SL. NO | SERVICES BY GTA | RATE |
| 1 | Carrying:
|
0% |
| 2 | To an unregistered person, including an unregistered casual taxable person | >0% |
| 3 | Services of goods transport agency (GTA) in relation to transportation of goods (including used household goods for personal use) | 5% with no ITC OR 12% with ITC |
| 4 | Goods, where consideration charged for the transportation of goods on a consignment transported in a single carriage does not exceed one thousand five hundred rupees | 0% |
| 5 | Goods, where consideration charged for transportation of all such goods for a single consignee does not exceed rupees seven hundred and fifty | 0% |
| 6 | By way of giving on hire to a goods transport agency, a means of transportation of goods | 0% |
| 7 | Used household goods for personal use | 0% |
| 8 | Hiring out vehicle to an Goods and Transport Agency | 0% |
Registration requirement for GTA service providers
Government has eased the requirement for registration for GTA service providers via notification no. 5/2017-Central tax. It has provided that a person who is engaged in making only supplies of taxable goods/services on which tax is required to be paid under reverse charge are exempted from obtaining registration.
Persons liable to pay GST on GTA services
The liability to pay GST lies on the recipient for the supply of goods by GTA who has not paid central tax @6%, in respect of transportation of goods by road if the recipients (located in the taxable territory) belong to any of the following categories:
- Factory registered under the Factories Act 1948
- Society registered under the Societies Registration Act, 1860
- The co-operative society established by or under any law
- The person registered under the CGST, SGST, IGST or UGST Act
- Any corporate body established by or under any law
- Partnership firm whether registered or not under any law including association of persons
- Casual taxable person
Invoicing for GTA
Any GST compliant invoice of a GTA must have following details-
- Name of the consignor and the consignee
- Number of goods carriage registrations used to transport the goods
- Details of goods transported
- Gross weight of the consignment
- Details of place of origin and destination
- GSTIN of the person liable for paying tax whether as consigner, consignee or goods transport agency
- Name, address and GSTIN (if applicable) of the GTA
- Tax invoice number (it must be generated consecutively and each tax invoice will have a unique number for that financial year)
- Date of issue
- Description of service
- Taxable value of supply
- Applicable rate of GST (Rates of CGST, SGST, IGST, UTGST and cess clearly mentioned)
- Amount of tax (With breakup of amounts of CGST, SGST, IGST, UTGST and cess)
- Whether GST is payable on reverse charge basis
- Signature of the supplier
Place of Supply for GTA
The place of supply of services by way of transportation of goods, including by mail or courier to, A registered person, shall be the location of such person A person other than a registered person, shall be the location at which such goods are handed over for their transportation.
Payment of Tax by a GTA
A GTA cannot enjoy any ITC on any of the inputs. So, payment of tax will be only through cash in the normal modes of card/netbanking/cash/UPI/IMPS (only for taxes upto Rs.10,000).
Returns to be filled by GTA
We will analyse this a bit carefully. In the above discussion, we have clearly seen that it is not mandatory for GTAs to have a registration. In case they are providing services on which tax is applicable then, payment is on the reverse charge basis. But if a GTA registers then in that case return filing becomes mandatory. Filing of normal returns relating to outward supplies, inward supplies and summary return (GSTR 1, GSTR 2, GSTR 3) on or before the respective dates is mandatory. If the GTA fails to file the return, then, they will have to pay interest and penalty.
Bottomline:
In a nutshell, the GST law continues the provisions prevailing under the service tax regime. Because the law recognises that pure transportation of goods and services is mostly provided by individuals in the unorganised sector, such operators are specifically excluded from the tax net. To reduce the problems of the people in the unorganised sector, relief is provided in many cases relating to options to pay tax and register, which will eventually prove useful for the taxpayer.
That brings us to the end of this post on the Goods Transport Agency under GST. Feel free to share your views and opinions with us in the comment section below.
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