Who is Supplier & Reciptient Under GST Act ?
Under the GST Act, 2017, the terms supplier and recipient refer to the parties involved in a supply of goods or services.
1. Supplier
A supplier is defined as the person or entity who provides goods or services to another. The supplier is responsible for charging GST on the sale or supply and for remitting the collected tax to the government. The supplier can be a business, a professional, or any individual providing goods or services.
Example:
- If a clothing retailer sells a shirt to a customer, the retailer is the supplier. The retailer collects GST on the sale of the shirt and is responsible for remitting it to the government.
2. Recipient
The recipient is the person or entity who receives the goods or services. The recipient is required to pay the GST charged by the supplier and, in most cases, can claim an Input Tax Credit (ITC) if they are a registered taxpayer, reducing their own tax liability on their output supply.
Example:
- If a customer purchases a shirt from the clothing retailer, the customer is the recipient. The customer pays GST on the shirt to the retailer. If the customer is a registered business, they may be able to claim ITC for the tax paid.
Key Points:
- Supplier’s Role: Charges and collects GST, and is liable to remit the tax to the government.
- Recipient’s Role: Pays GST to the supplier and may claim Input Tax Credit (ITC) if eligible.
Practical Scenario:
- Supplier: A manufacturer who sells goods (e.g., a smartphone).
- Recipient: A retailer or an individual who buys the goods (e.g., a mobile phone store or a customer buying the phone).
In conclusion, under GST, the supplier provides the goods/services and collects GST, while the recipient receives the goods/services and pays the GST, potentially claiming an ITC if they are registered.
