One of the important issues which most of the customers neglect is the GST invoice.
The bogus packers and movers do not know about it and they simply charge the customer either 0%,5%,12%,18% or even 28% GST without even having a GST number.
Goods and services tax were launched in India from 1st July 2017 under which there are five slabs.
- 0%-
This slab is applicable which is also called Reverse charge mechanism (RCM) under which the recipient gives a declaration that he will pay the GST directly to the government of India. The recipient must have a GST number in this case.
- 5%-
This slab is applicable if a customer is utilising only transportation services. The packers and movers usually provide five services i.e
- Dis-mantling
- Packaging
- Loading
- Transportation
- Unloading
Since different rates are applicable for different services if you are taking only transportation than you need to pay only 5% GST. In case of loading/unloading/packaging labor/packaging material is used and for this you need 18% GST as per GOI.
- 12%-
Whenever transportation services are provided to a company 12% GST is charged. Just remember, in this case also only transportation is covered. If a company takes other services like Dismantling, Packaging, Loading/Unloading than GST will be charged at 18% of the total amount.
- 18%-
Your GST bill must be with 18% as for packers and movers’ complete services which includes dismantling, packaging, loading, unloading, transportation and insurance the applicable GST rate as per Government of India is 18%. This gives you an additional benefit as insurance companies.
- 28%–
28% GST is charged for luxury items like gold/silver or high-end fashion clothing. If a Packers and Movers services provider is charging you 28% GST than its against the GST laws.
A reputed packer and movers’ services provider always guides its client accordingly, so that the billing is done as per government of India guidelines. The interest of customer is also protected, as in case of any eventuality, the insurance claim comes handy.
In case the GST is charged at 5% on the invoice value, the insurance company will not process the claim citing documentation error.
We suggest you go with the best packers and movers, so you get peace of mind during and after your relocation. Refer our guide on “How to get the right packers and movers’ services provider”.
Other articles by SCM For You on house shifting services are :