12 September 2026 · Ruhu AI
Reverse Charge on Services in 2026: The Current List and the Changes That Trip People Up
The reverse charge list under Section 9(3) of the CGST Act, carried in Notification 13/2017-Central Tax (Rate), has been amended around fourteen times. Advice that was right in 2023 is wrong today in at least two places. Here is where the list stands and what changed.
The core list (recipient pays)
| Service | Supplier | Recipient who pays |
|---|---|---|
| Goods transport agency (GTA) | GTA that has not opted for forward charge | Factories, registered persons, body corporates, partnership firms, among other specified recipients |
| Legal services | Individual advocate (including a senior advocate) or firm of advocates | Any business entity in the taxable territory |
| Arbitral tribunal | Arbitral tribunal | Business entity |
| Sponsorship | Any person OTHER than a body corporate (see below) | Body corporate or partnership firm |
| Director services | Director of a company or body corporate | The company or body corporate |
| Security services (supply of personnel) | Non-body-corporate supplier | Registered person (composition taxpayers and TDS-only government registrants excluded) |
| Renting of motor vehicle (with cost of fuel) | Non-body-corporate charging 5% | Body corporate |
| Insurance agent, recovery agent, copyright, government services | As notified | As notified |
| Renting of immovable property | See the 2024 change below | Registered person |
Separately, import of services is reverse charge under Section 5(3) of the IGST Act with no category list at all: almost any service received for consideration from a foreign supplier qualifies (the carve-out is OIDAR services to unregistered consumers, where the foreign provider itself must collect), and an unregistered business importing services becomes liable to register.
Change 1: sponsorship flipped for corporate sponsors (January 2025)
From 16 January 2025, sponsorship services provided by a body corporate moved to forward charge: the corporate sponsor-service provider now charges GST like any normal supplier. Reverse charge on sponsorship continues only where the provider is a non-corporate (individual, firm). If your systems still self-assess RCM on every sponsorship invoice, you are double-handling tax on the corporate ones.
Change 2: commercial property rent from unregistered landlords (October 2024)
From 10 October 2024, renting of immovable property (other than residential dwellings) by an unregistered person to a registered person attracts reverse charge. The registered tenant self-assesses the GST. From 16 January 2025, composition taxpayers were carved out of this entry, and the intervening period was regularised on an as-is basis. Combined with the older rule taxing residential dwellings rented to registered persons (a proprietor renting purely for personal residence is exempt since January 2023), a registered business now needs to look at every rent agreement where the landlord has no GSTIN.
One caution on the ITC side: place of supply for immovable property is the property's location. If the property sits in a state where you hold no registration, the RCM you pay there may be credit you cannot use. That is a cost decision to make consciously, not discover later.
Change 3: GST 2.0 did not change GTA reverse charge
The rate rationalisation effective 22 September 2025 moved the GTA forward-charge option from 12% to 18%, but the 5% reverse-charge default for GTA services did not change. Freight on RCM at 5% remains the standard case for most recipients.
Adjacent to the services list: metal scrap, a goods RCM entry
Purchases of metal scrap from unregistered suppliers attract reverse charge from 10 October 2024. This one sits in the goods notification (Notification 4/2017), not the services list, but it belongs on the same checklist: an entry aimed at a leak-prone industry but relevant to any manufacturer buying scrap.
The compliance mechanics, whatever the entry
- Liability goes in GSTR-3B Table 3.1(d) and must be discharged in cash (Section 49(4), Rule 85(4)).
- For supplies from unregistered persons, raise a self-invoice within 30 days (Rule 47A, since 1 November 2024).
- Claim the ITC in Table 4(A)(3) where eligible, after payment.
- Book both legs in your accounting system in the same month as the supply. Legs booked months late are how audit findings are made.
Frequently asked questions
Our lawyer is an LLP. Is it still RCM? A firm of advocates, including an LLP of advocates, is within the legal-services RCM entry when serving a business entity.
We sponsor events run by a private limited company. RCM? Not since 16 January 2025. The corporate provider charges you GST on the invoice.
Our landlord is an individual without GST registration, renting us an office. RCM? Yes, since 10 October 2024, if you are registered (and not a composition taxpayer, after 16 January 2025).
Our director rents his personal property to the company. Is that director-services RCM? No. Circular 201/13/2023 clarifies that only services supplied in the capacity of a director fall under that entry. Renting in personal capacity follows the property rules above, including the 2024 unregistered-landlord change.
Is there still RCM on all purchases from unregistered persons? The general Section 9(4) levy stands restricted to specified cases, mainly real-estate promoters. The notified lists above are what matter for most businesses.