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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Overview of Goods and Services Tax

A supplier's customer pays on 1 June, which is the date the payment is entered in the supplier's books. The bank credits it on 3 June. For the change-in-rate provisions of section 14 of the CGST Act, 2017, which date is the date of receipt of payment, ignoring the four working day proviso?

The date of receipt of payment is 1 June. The Explanation to section 14 treats it as the earlier of the date of entry in the supplier's books and the date of credit to the bank account.

  1. A3 June, the bank credit date
  2. BThe date of the invoice
  3. CThe average of the two dates
  4. D1 June, the earlier of the book entry and bank creditCorrect

Explanation

The Explanation to section 14 states that the date of receipt of payment is the date the payment is entered in the supplier's books or the date it is credited to the bank account, whichever is earlier. Here 1 June is earlier than 3 June. The bank credit date matters only under the proviso when credit occurs after four working days from the rate change.

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