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Published on:
February 20, 2023
By
Paramita

FAQs: RCM on Foreign Company Invoices, GST Evasion Complaint

As a small or medium business owner or startup founder in India, you may have questions about RCM on foreign company invoices and GST evasion complaints. These are important topics that can have significant implications for your business. In this article, we will answer some frequently asked questions about RCM on foreign company invoices, as well as provide information on how to file a GST evasion complaint.

RCM on Foreign Company Invoices

RCM stands for Reverse Charge Mechanism. Under this mechanism, the recipient of goods or services is required to pay the tax instead of the supplier. This rule was introduced to ensure greater compliance among foreign companies operating in India.

What is RCM on foreign company invoices?

RCM on foreign company invoices is a tax system where the recipient of goods or services is required to pay the tax. This system was introduced to ensure greater compliance among foreign companies operating in India. Under this system, the liability to pay tax is shifted from the supplier to the recipient.

Who is liable to pay tax under RCM on foreign company invoices?

The liability to pay tax under RCM on foreign company invoices falls on the recipient of goods or services. If you are a small or medium business owner or startup founder in India and you receive goods or services from a foreign company, you may be liable to pay tax under RCM.

What is the rate of tax under RCM on foreign company invoices?

The rate of tax under RCM on foreign company invoices is the same as the rate of tax that would have been applicable if the supplier of the goods or services was a resident of India. This means that if the tax rate for a particular product or service in India is 18%, the tax rate under RCM would also be 18%.

How is RCM on foreign company invoices calculated?

The calculation of RCM on foreign company invoices is similar to the calculation of tax under the regular GST system. The only difference is that the liability to pay tax falls on the recipient rather than the supplier. You will need to calculate the tax based on the value of the goods or services received and the applicable tax rate.

Is there any exemption from RCM on foreign company invoices?

Yes, there are some exemptions from RCM on foreign company invoices. For example, if the value of the goods or services received from a foreign company does not exceed Rs. 5,000 in a day, you do not need to pay tax under RCM. Similarly, if the goods or services received are exempt from GST, you do not need to pay tax under RCM.

GST Evasion Complaints

GST evasion is a serious issue in India. It is important to report any instances of GST evasion to the relevant authorities. In this section, we will provide information on how to file a GST evasion complaint.

What is GST evasion?

GST evasion is the intentional act of not paying GST or under-declaring the value of goods or services to avoid paying the full amount of GST due. GST evasion is a crime under the GST Act and can result in heavy penalties and imprisonment.

How can I file a GST evasion complaint?

You can file a GST evasion complaint by visiting the official GST portal (https://www.gst.gov.in/) and clicking on the "File Complaint Against Taxpayer" option. You will need to provide details of the taxpayer against whom you are filing the complaint, as well as details of the alleged evasion.

What happens after I file a GST evasion complaint?

After you file a GST evasion complaint, the relevant authorities will investigate the matter. If they find that GST evasion has taken place, they may take legal action against the taxpayer in question. This can include imposing penalties, fines, and even imprisonment.

Is there any protection for whistleblowers who file GST evasion complaints?

Yes, the GST Act provides protection to whistleblowers who file GST evasion complaints. If you file a complaint in good faith, you will not be subject to any legal action or penalty.

Conclusion

In conclusion, RCM on foreign company invoices and GST evasion complaints are important topics that small and medium business owners and startup founders in India should be aware of. By understanding these topics, you can ensure that your business is in compliance with the relevant laws and regulations, and also help to promote a fair and transparent business environment in India.

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Updated on:
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