Forward Charge (GTA charges GST)
Also searched as: forward charge GTA · GTA forward charge 18% · GTA 5% or 18% · forward charge vs RCM
Under forward charge, the Goods Transport Agency itself charges GST on its freight invoice and pays it to the government, as a normal supplier does. A GTA can choose 18% with input tax credit (from 22 September 2025, earlier 12%) or 5% without input tax credit. The alternative is reverse charge, where the receiver pays.
Detailed Explanation & Statutory Rules
The default for GTA services is reverse charge: the receiver, if it is a registered business or similar, pays 5% and the GTA takes no input tax credit. A GTA can opt out of that default and charge GST itself under forward charge, by filing Annexure V on the GST portal. It then writes the declaration (Annexure III) on its invoices and charges either 18% with input tax credit or 5% without. The right choice depends on how much GST the GTA pays on its own costs, such as tyres, repairs, vehicles and services (diesel is outside GST), and on what its customers want. Always confirm the option with your CA and apply it from the start of the financial year. In Bilty the company's option is set per financial year and the rate follows it.
Practical Indian Freight Example
"For illustration: a GTA with large tyre and repair bills on which it pays GST opts for forward charge at 18% with ITC. A ₹50,000 freight invoice to a Surat party shows ₹9,000 GST (₹4,500 CGST + ₹4,500 SGST for an intra-state trip) and the Annexure III declaration, total ₹59,000. The party can claim credit if eligible."
Key Questions & Answers
What is the GST rate on GTA under forward charge?
18% (9% CGST + 9% SGST) with input tax credit from 22 September 2025, or 5% without input tax credit. Under reverse charge it is 5% paid by the receiver. Confirm with your CA.
How do I opt for forward charge?
File Annexure V on the GST portal (Services, User Services), normally between 1 January and 31 March before the financial year. See the Annexure V page.
Forward Charge in Hinglish (Hindi in English letters)
Forward charge kya hota hai GTA me?
Forward charge me transporter khud invoice par GST lagata aur bharta hai. RCM me receiver bharta hai.
Forward charge me GST kitna lagta hai?
ITC ke saath 18% (22 Sep 2025 se) ya bina ITC ke 5%. CA se confirm karein.
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