?? GST Update: Key Amendments of Interim Budget 2024 Notified
CA Dinesh Singhal
Chartered Accountant | Tax Expert | Helping Businesses Navigate Complex Tax Laws
?? Changes Relating to Input Service Distributor (ISD) - shall be effective from 1st April 2025
1. Enhanced Definition of ISD: The definition of Input Service Distributor (ISD) has been updated to include the distribution of credit for services taxed under the reverse charge mechanism (Section 2(61) of the CGST Act). This ensures that ISDs can distribute input service credits, including those for reverse charge invoices.
2. Mandatory ISD Registration: As per the amended Section 20(1) of the CGST Act, 2017, offices receiving tax invoices for input services, including those under the reverse charge mechanism, must register as an ISD. The ISD is required to distribute the input tax credit for such invoices.
3. Distribution of Credit by ISD: Section 20(2) and 20(3) of the CGST Act, 2017, has been amended to allow ISDs to distribute credits for input service invoices, including those taxed under reverse charge, provided the tax has been paid by a distinct person registered in the same state.
?? New Penalty Provision for Unregistered Manufacturing Machines effective from 1st October 2024
Section 122A imposes a penalty for failing to register machines used in the manufacture of goods under the special procedure notified in Section 148 of the CGST Act (e.g., Tobacco, Pan-masala). The penalty is Rs. 1 Lakh per unregistered machine under the CGST Act, totaling Rs. 2 Lakhs (Rs. 1 Lakh each under CGST and SGST).
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