GST RCM Compliance Guide
GST Reverse Charge Mechanism for Transporters — Guide 2025
Under the GST Reverse Charge Mechanism (RCM) for goods transport, the recipient of the service (not the transporter) pays GST directly to the government. This guide explains how RCM works for GTA services, who is liable, how to self-invoice, and how to claim Input Tax Credit.
Key fact: GoMyTruck provides GST-compliant digital invoices for every booking. Enterprise accounts receive monthly consolidated GST statements for RCM compliance. Contact enterprise@gomytruck.com for business account setup.
When Does RCM Apply for GTA Services?
RCM applies to GTA services when: (a) The GTA is registered under GST and has opted for the 5% rate, OR (b) The GTA is unregistered. The recipient of GTA services must pay GST under RCM if they are one of these notified categories: factory, society, cooperative society, registered person, body corporate, partnership firm, or government entity.
How Much GST to Pay Under RCM?
Under RCM for GTA services: 5% GST (2.5% CGST + 2.5% SGST for intra-state, or 5% IGST for inter-state) where the GTA has opted for the 5% rate. 12% GST applies if the GTA has opted for Forward Charge with ITC. Individual consumers and small agriculturalists receiving GTA services are exempt from RCM.
Self-Invoice — Required Under RCM
When you pay GST under RCM as a recipient, you must issue a self-invoice. A self-invoice is a document you create for yourself as the recipient, containing: supplier (GTA) details, your GSTIN as recipient, invoice date, description of service, value, and RCM GST amount. This self-invoice is your document to claim ITC.
Claiming ITC on RCM Payments
You can claim Input Tax Credit on GST paid under RCM for GTA services, subject to conditions: (a) The service is used for business purposes, (b) You have filed the RCM return (GSTR-3B), (c) The ITC is not restricted under Section 17(5). ITC can be claimed in the same period in which the RCM is paid, not earlier.
RCM Compliance Steps for Businesses Using Trucks
Step 1: Verify if your GTA is registered and which rate option they have chosen. Step 2: Obtain the consignment note from the GTA. Step 3: Calculate the RCM GST amount. Step 4: Issue a self-invoice. Step 5: Pay RCM GST in GSTR-3B by the 20th of the following month. Step 6: Claim ITC in the same period's GSTR-3B.
RCM rules for GTA services are complex and subject to change. Consult a qualified Chartered Accountant for advice specific to your business. This guide is for general informational purposes only.