Logistics terms · Logistics terms
What does RCM (reverse charge mechanism) mean in logistics?
Short answer
A GST arrangement under which the recipient of a supply, rather than the supplier, pays the tax to the government.
Notified under Section 9(3) of the CGST Act. GTA services to specified recipients are the most common RCM case in logistics: the business receiving the service pays 5% GST and may usually claim it as input tax credit. Ask our desk how this applies to your consignment.
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The numbers behind this answer
- Also called
- RCM, reverse charge
- Category
- Documents & tax
- Related terms
- GTA (goods transport agency), GST (Goods and Services Tax), ITC (input tax credit), Freight bill
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