GST on Freight Forwarder (Import Cases)

Import Cases for Freight Forwarder Registered in India

3A) :Import Shipment , First case : PP-PP : Freight

Import Shipment – Freight Prepaid (Collected by Overseas Agent), Prepaid on sale side Prepaid on expense side

  • Freight
    • We don’t bill
    • We don’t get
    • We don’t pay
    • So, not relevant to us, hence irrelevant to discuss the GST ?
  • Commission
    • This is billed by Forwarder to overseas Agent
    • Place of supply is India, so export of service conditions is not satisfied ( screenshot below)
    • Hence, commission is taxable in India, at full 18% rate
  • Other charges
    • Normal GST in India

3B) :Import Shipment , Second : PP-C : Freight

Collect in India

Import Shipment = Freight Prepaid (Collected by Overseas Agent),

Expense side = Purchase from Shipping line in India

Sale side = we have to pay in india to shipping line, hence to recover from Agent // sale bill for us

  • Freight expense side :
    • Pure Indian Transaction, No exemption, they will charge GST from us
  • Freight income side :
    • Will be taxable,
    • Since billed from india
    • And service on goods terminating in india,
    • Hence taxable in india
  • Other charges
    • Will be taxable,

3C) :Import Shipment , Third case

Import Shipment – Freight Collect (Collected by Freight Forwarder from Consignee)
  • Freight – GST will be billed by Forwarder to Consignee
    • Yes agreed Since normal domestic work No exemption
  • Other Charges – GST will be billed by Forwarder to Consignee
    • Yes agreed Since normal domestic work No exemption
Again if We bill Differential (Selling Freight less Buying Freight) to Overseas Agent this will be billed as Commission with GST

Purchase of Freight and other Charges If Purchase from Shipping Line In India – Shipping line will bill GST to Forwarder If Purchase from Overseas Agent – Forwarder will book RCM and avail Input

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