Provision on Place of Supply under GST

The Goods and Services Tax (GST) is a comprehensive tax system that has replaced several indirect taxes in India. Place of Supply is a crucial concept under GST as it determines the place where a supply is deemed to have taken place for the purpose of levying the appropriate taxes. In this article, we will explain the provisions related to Place of Supply under GST in detail.

What is Place of Supply?

Place of Supply refers to the place where a supply is deemed to have taken place for the purpose of levying taxes under GST. It determines the taxation jurisdiction and the applicable tax rate. The Place of Supply rules vary depending on the type of supply and the location of the supplier and the recipient.

Place of Supply for Goods

The Place of Supply for goods is determined based on the movement of goods. The following table explains the Place of Supply rules for goods under GST:

S.No.	Nature of Service	Place of Supply
1	Services supplied for goods that are required to be made physically available from a remote location by way of electronic means (Not applicable in case of goods that are temporarily imported into India for repairs and exported)	The location where the services are actually performed, The location where the goods are situated
2	Services supplied to an individual and requiring the physical presence of the receiver	The location where the services are actually performed
3	Immovable property-related services, including hotel accommodation	Location at which the immovable property is located
4	Admission to or organisation of an event	The place where the event is actually held
5	If the said three services are supplied at more than one locations i.e. , (i) Goods & individual related (ii) Immovable property-related (iii) event related
6	At more than one location, including a location in the taxable territory	Its place of supply shall be the location in the taxable territory where the greatest proportion of the service is provided
7	In more than one State	Its place of supply shall be each such State in proportion to the value of services provided in each State
8	Banking, financial institutions, NBFC Intermediary services, hiring of vehicles’ services etc.	Location of the supplier of service
9	Transportation of goods	The place of destination of the goods
10	Passenger transportation	place where the passenger embarks on the conveyance for a continuous journey
11	Services on-board a conveyance	The first scheduled point of departure of that conveyance for the journey
12	Online information and database access or retrieval services	The location of recipient of service

Place of Supply for Services

The Place of Supply for services is determined based on various factors such as the location of the supplier, the location of the recipient, and the nature of the service provided. The following table explains the Place of Supply rules for services under GST:

S.No.	Nature of Service	Place of Supply
1	Services supplied for goods that are required to be made physically available from a remote location by way of electronic means (Not applicable in case of goods that are temporarily imported into India for repairs and exported)	The location where the services are actually performed, The location where the goods are situated
2	Services supplied to an individual and requiring the physical presence of the receiver	The location where the services are actually performed
3	Immovable property-related services, including hotel accommodation	Location at which the immovable property is located
4	Admission to or organisation of an event	The place where the event is actually held
5	If the said three services are supplied at more than one locations i.e. , (i) Goods & individual related (ii) Immovable property-related (iii) event related
6	At more than one location, including a location in the taxable territory	Its place of supply shall be the location in the taxable territory where the greatest proportion of the service is provided
7	In more than one State	Its place of supply shall be each such State in proportion to the value of services provided in each State
8	Banking, financial institutions, NBFC Intermediary services, hiring of vehicles’ services etc.	Location of the supplier of service
9	Transportation of goods	The place of destination of the goods
10	Passenger transportation	place where the passenger embarks on the conveyance for a continuous journey
11	Services on-board a conveyance	The first scheduled point of departure of that conveyance for the journey
12	Online information and database access or retrieval services	The location of recipient of service

Place of Supply in Case of B2B and B2C Transactions

S.No.	Description of Supply	Place of Supply
1	B2B	Location of such Registered person
2	B2C	(i) location of the recipient where the address on record exists, and (ii) location of the supplier of services in other cases

Place of Supply in Case of Services outside India

S.No.	Nature of Service	Place of Supply
1	Services supplied for goods that are required to be made physically available from a remote location by way of electronic means (Not applicable in case of goods that are temporarily imported into India for repairs and exported)	The location where the services are actually performed, The location where the goods are situated
2	Services supplied to an individual and requiring the physical presence of the receiver	The location where the services are actually performed
3	Immovable property-related services, including hotel accommodation	Location at which the immovable property is located
4	Admission to or organisation of an event	The place where the event is actually held
5	If the said three services are supplied at more than one locations i.e. , (i) Goods & individual related (ii) Immovable property-related (iii) event related
6	At more than one location, including a location in the taxable territory	Its place of supply shall be the location in the taxable territory where the greatest proportion of the service is provided
7	In more than one State	Its place of supply shall be each such State in proportion to the value of services provided in each State
8	Banking, financial institutions, NBFC Intermediary services, hiring of vehicles’ services etc.	Location of the supplier of service
9	Transportation of goods	The place of destination of the goods
10	Passenger transportation	place where the passenger embarks on the conveyance for a continuous journey
11	Services on-board a conveyance	The first scheduled point of departure of that conveyance for the journey
12	Online information and database access or retrieval services	The location of recipient of service

Other than the services mentioned above, the place of supply would be the location of the service recipient. If such a location is not available in the normal course of business, the place of supply would be the location of the service provider.

Conclusion

The Place of Supply rules under GST are designed to simplify the taxation process and prevent double taxation. It is important for businesses to understand and comply with these rules to avoid penalties and legal issues. By understanding the Place of Supply rules, businesses can ensure that they levy the correct taxes and maintain proper records.