Process for charging GST, If a local supplier in India purchases goods or services from an international supplier, the local supplier would be require to pay the Integrated Goods and Services Tax (IGST) on the import of goods or services, and the local supplier can claim the credit of such IGST paid as input tax credit (ITC) under GST laws.
What is the process for charging GST on an international purchase invoice raise for a local supplier?
When the local supplier issues an invoice to their customer, the GST would be charge on the value of the goods or services supply, including the IGST paid by the local supplier on the import of such goods or services. The GST rate would depend on the nature of goods or services supply and would be applicable as per the GST laws of India.
What is the process for charging GST on an international purchase invoice raise for a local supplier?
For example, if a local supplier in India purchases goods from an international supplier for INR 1000, on which IGST of INR 180 is paid, the local supplier would pay INR 1180 to the international supplier. When the local supplier sells these goods to their customer for INR 2000, the GST would be charge on INR 2000, including the IGST paid on import. If the applicable GST rate is 18%, then the GST charge would be INR 360 (18% of INR 2000), and the local supplier would have to pay INR 164 (INR 360 – INR 180 claim as ITC) to the government as the net GST liability.
To visit https://www.gst.gov.in/
