All the B2B transactions of Metal scrap falling under chapter 72 to 81to attract TDS @2%

 

GST TDS @ 2% condition is applicable w.e.f 10/10/2024 on metal scrap, So please note that all the B2B transactions of Metal scrap falling under chapter 72 to 81 will now attract 2% TDS deduction on basic value of material,  with following conditions:

1. GST TDS Applicable on all B2B purchases w.e.f from 10.10.2024

2. The rate of TDS for intra –state supply is one percent each under both CGST and SGST Acts. This deduction is to be made from the payment made or credited to the supplier (deductee) where the total value under the contract exceeds 2.5 lacs

3. As per Explanation to Section 51 (1),  the value of supply for the purpose of deduction of tax is the amount indicated in the invoice excluding the central tax, State tax, Union territory tax, integrated tax and cess.

4. As per proviso to Section 51 (1), no deduction shall be made if the location of the supplier and the place of supply is in a State /Union territory which is different from the State/ Union territory of registration of the recipient. Say a recipient registered at Noida receives the supply having place of supply at Delhi from a supplier having location at Delhi, TDS will not be applicable.

5. As per Section 24 (vi) persons who are required to deduct tax under section 51 need compulsory registration whether or not separately registered under GST. As per Rule 12 of the CGST Rules, 2017, the tax deductor shall electronically submit an application, duly signed or verified through electronic verification code, in FORM GST REG-07 for the grant of registration through the common portal.

6. As per Section 51 (2), the amount deducted as tax under this section shall be paid to the Government by the deductor within ten days after the end of the month in which such deduction is made.

7. As per Section 51 (3),   a certificate of tax deduction shall be issued to the deductee in the prescribed manner. As per Rule 66 of the CGST Rules, 2017, this certificate  shall be made available electronically to the deductee on the common portal in FORM GSTR-7A on the basis of the return furnished under sub-rule 66 (1). This is generated by the system itself.

8. Also on Purchase of Metal Scrap from URD Perons RCM is applicable from 10.10.2024 with Notification No. 06/2024-Central Tax (Rate) which amends basic notification 4/2017- Central Tax (Rate) dated 28.06.2017 w.e.f. 10.10.2024.

9. Metal Scrap means metal scrap – falling under chapters 72 to 81 of CTH