Dear Sir, A company issued Tax Invoice separately for interest on delayed payment of goods. Is it correct ??
2) If separate Tax Invoice is issued whether GST @ 18% should be charged, or else, GST rate of goods should be charged ??
1) Naturally as late payment interest is event after supply is made, the supplier will be issuing a separate tax invoice for it. Rather as late payment interest is an addition in value of the supply and thus it would be proper that as per Sec 34(3) of the CGST Act,2017 a debit note for the same is issued which is linked with the invoice of the original supply.
2) As per Sec 15(2)(d) as late payment intt is an addition in value of the supply. Accordingly the late payment intt charged will not be regarded as independent supply and rather is a part of the value of supply, on whose delayed payment interest has been charged.Therefore GST rate applicable on goods should be charged.
You can also refer to article “Treatment of late payment interest under GST law” , published today on this website.
Team Clearmytax.in