Suppose a supplier of taxable service had received an advance of Rs 1,00,000/- plus GST @ 18% i.e. total Rs 1,18,000/- . Subsequently there is change in rate of tax from 18% to 12%. Supply of Rs 1,50,000/- made after change in rate of tax. What rate would apply and how invoice will be issued?
As per the provisions of Sec 14 of the CGST Act, 2017, in case there is change in rate of tax the time of supply would be determined based upon when majority of events out of when three events took place viz date of supply, date of invoice and date of payment. As in this case the date of supply and date of invoice happened after change in rate of tax , new rate shall be applicable on full amount of Rs 1,50,000/-and tax invoice shall be raised for Rs 1,68,000/-
Accordingly in this case the recipient need to pay only Rs 60,000/- now (Rs 1,68,000 minus Rs 1,18,000). The supplier in its GSTR 1 shall include details of invoice now raised and show adjustment of advance adjusted with GST collected at tha time in table 11 of GSTR-1.
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