Time of Supply in case of Change in Rate of Tax under GST Scenario:

In the recent time rate f taxes are changed frequently. At the time of supply of goods or services, we need to charge correct rate of tax on supplies. To determine correct rate on supply, we need to determine correct time of supply.

With the help of following table we can determine time of supply in case of change in rate of tax:

The Date of receipt of payment shall be the date of credit in the bank account if such credit in the bank account is after four working days from the date of change in the rate of tax.

Date of receipt of the payment by supplier: Payment is entered into the books of the account or credited in his bank account whichever is earlier.

Examples:

Q.1. Mr. A is supplied goods to Mr. B on 28^th December,2017. The GST rate on goods is changed from 12% to 5% w.e.f. 1^st January 2018. Mr. A issued invoice on 28^th December,2017 and payment is creitedd in his bank account on 30^th December,2017. What is the time of supply n this case

Ans). Following Event have been done before change in effective rate of tax:

– Goods supplied,

– Invoice Issued,

– Payment received.

Time of supply will be earliest of the following:

– 28^th December,2017,

– 30^th December 2017

So, Time of supply will be 28^th December,2017.

Q.2. Mr. A is supplied goods to Mr. B on 28^th December,2017. The GST Rate on goods is changed from 12% to 5% w.e.f. 1^st January2018. Mr. A issued invoice on 2^nd January,2018 and payment is credited in his bank account on 29^th December,2017. What is the time of supply in this case

Ans). Following Event have been done before change in effective rate of tax.

– Goods supplied,

– Payment Received.

So, Time of supply will be Date of receipt of payment i.e. 29^th December, 2017.

Q.3. Mr. A is supplied goods to Mr. B on 28^th December, 2017. The GST rate on goods is changed from 12% to 5% w.e.f. 1^st January, 2018. Mr. A issued invoice on 28^th December, 2017 and payment is credited in his bank account on 4^th January, 2018. What is the time of supply in this case

Ans). Following Events have been done before change in effective rate of tax.

– Goods Supplied,

– Invoice Issued.

So, Time of supply will be date of Invoice i. e 28^th December 2017.

Q.4. Mr. A is supplied goods to Mr. B on 2^nd January ,2018. The GST rate on goods is changed from 12% to 5% w.e.f. 1^st January,2018. Mr. A issued invoice on 28^th December,2017 and payment is credited in his bank account on 30^th December,2017. What is the time of supply in this case

Ans). Following Events have been done before change in effective rate of tax.

– Invoice issued,

– Payment Received.

Time of supply will be earliest of the following.

– 28^th December, 2017.

– 30^th December, 2017.

So, in the case time of supply will be 28^th December2017.

Q.5. Mr. A is supplied goods to Mr. B on 2^nd January2018. The GST rate on goods is changed from 12% to 5% w.e.f. 1^st January,2018. Mr. A issued invoice on 29^th December,2017 and payment is credited in his bank account on 4^th January,2018. What is the time of supply in this case

Ans). Following Event have been done before change in effective rate of tax.

– Invoice Issued.

Time of supply will be date of receipt of the payment i.e. 4^th January,2018.

Q.6. Mr. A is supplied goods to Mr. B on 2^nd January, 2018. The GST rate on goods is changed from 12% to 5% w.e.f. January ,2018. Mr. A issued invoice on 2^nd January,2018 and payment is credited in his bank account on 29^th December,2017. What is the time of supply in this case

Ans). Following Event have been done before change in effective rate of tax.

– Payment received.

So, in this case time of supply will be date of invoice i.e. 2^nd January, 2018.

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