GST & Compliance
Reverse Charge Mechanism
RCM
GST liability where the recipient (not the supplier) pays GST directly to the government.
What it means
Under RCM, instead of the supplier collecting GST from the buyer and depositing it, the buyer self-assesses and pays GST directly. RCM applies in three scenarios: (1) notified categories of goods/services (e.g., goods transport agency, legal services from advocates), (2) purchases from unregistered persons under Section 9(4) — currently restricted, (3) imports of services.
The buyer issues a self-invoice, pays GST in GSTR-3B and can claim ITC on the same in the next return.
How Easedesk handles Reverse Charge Mechanism
Easedesk classifies vendor invoices automatically — flagging RCM applicability based on vendor type and service category. Self-invoices for RCM are generated, GSTR-3B Table 3.1(d) is auto-populated, and ITC claim is staged for the subsequent return.
Related terms
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