Analyzing the Change in rate of tax in respect of supply of goods or services
Section 14 of CGST Act, 2017 states the provisions about Change in rate of tax in respect of the supply of goods or services. The following aspects are dealt with in the form of questions and their answers:-
1. What aspects are to be looked upon in case of Change in rate of tax in respect of supply of goods or services?
Notwithstanding anything contained in section 12 or section 13, a combination of time of supply of goods or services, invoice and payment decided the time of supply and accordingly applicable rate of tax is decided. Meaning there, if there is change in rate of tax, then section 14 shall prevail and the time of supply is to be decide s per Section 14 only instead of section 12 or Section 13.
2. What is the provision in case of change in rate of tax of the goods or services?
|Time of Supply of Goods or Services||Invoice||Payment||Time of Supply as per Section 14||Rate of Tax to be applied|
|Before||After||After||Payment or Invoice, whichever is Earlier||NEW RATE|
|After||Before||Before||Payment or Invoice, whichever is Earlier||OLD RATE|
3. What is the date of receipt of payment?
For the purposes of this section, “the date of receipt of payment” shall be the date on which the payment is entered in the books of account of the supplier or the date on which the payment is credited to his bank account, whichever is earlier.
Provided that 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.
What if the notification specifies the date of applicability of tax rate?
In such a case, the date mentioned in notification, shall be the applicable date of rate of tax.
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