Building Construction: Getting Smart with GST and Reverse Charge

Construction Sector is the second largest employer in the country after agriculture.

And Unorganized sector continues to dominate the volume of business transacted. A quick look at annual reports of known brands in the construction industry brings out that the so called “disruption caused by GST” is well behind us. GST is encouraging the shift to organized sector.If you have recently purchased a small packet of white cement, it is very unlikely that you were given a GST invoice. Cash is st ..

Given that there is a large set of “unregistered” parties in this sector, the concept of reverse charge in GST carries significance. In normal business, the seller will invoice the customer adding GST. GST is paid by buyer and collected by seller. The onus is on the seller to submit details of outward supply in GSTR-1 and pay taxes to government. In the scenario where seller is unregistered, the onus is transferred to the buyer. Since the seller as unregistered and cannot add tax on his invoice, ..