Value of Supply in GST Presented by PAMS

Transcript:Value of Supply in GST Presented by PAMS:
Value of Supply in GST Presented by PAMS Professional Group 1 Section and Rules Section 15 of CGST Act, 2017 provides the provisions for determining the value of goods and services. It provides the mechanism to know how to calculate the value of goods or services when supply of goods and services is made between unrelated persons and when the price is the sole consideration of the supply. Provisions of the value of supply under CGST act have also been made applicable to IGST Act vide Section 20 of the IGST Act. Valuation Rules are prescribed under Chapter IV of the Central Goods & Services Tax Rules, 2017 from Rule 27 to Rule 35. 2 Section 15- Value of Supply 15(1)- The value of a supply of goods or services or both shall be the transaction value, which is the price actually paid or payable for the said supply of goods or services or both where the supplier and the recipient of the supply are not related and the price is the sole consideration for the supply. So we can say that if the supplier and recipient are not related and the price is the sole consideration then the value of taxable supply is the Transaction Value. 3 Related Person The term related person would include the following :- Such persons are officers or directors of one another’s businesses; Persons legally recognized as partners in business; Such persons are employer and employee; Any person directly or indirectly owns, controls or holds twenty-five per- cent. or more of the outstanding voting stock or shares of both of them; One of them directly or indirectly controls the other; A third person directly or indirectly controls both of them; Together they directly or indirectly control a third person; They are members of the same family; The term person includes legal persons Persons who are associated in the business of one another would also deem to be related 4 Inclusions in the Value of supply 15 (2)- The value of supply shall include: (a) any taxes, duties, cesses, fees and charges levied under any law for the time being in force other than the GST Act, if charged separately by the supplier; (b) any amount that the supplier is liable to pay in relation to such supply but which has been incurred by the recipient, but not included in the price; (c) incidental expenses,