Taxable value when consideration is not solely in money

In some cases,

where consideration for a supply is not solely in money, taxable value has to be determined as prescribed in the rules. In such cases following values have to be taken sequentially to determine the taxable value:

• Open Market Value of such supply.
• Total money value of the supply i.e. monetary consideration plus money value of the non-monetary consideration.
• Value of supply of like kind and quality.
• Value of supply based on cost i.e. cost of supply plus 10% mark-up.
• Value of supply determined by using reasonable means

Special provisions related to determination of value of redeemable vouchers/ stamps/ coupons/ tokens

The value of a token, or a voucher, or a coupon, or a stamp (other than postage stamp) which is redeemable against a supply of goods or services or both shall be equal to the money value of the goods or services or both redeemable against such token, voucher, coupon, or stamp.

Valuation of certain works contract services

(i) Construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of completion certificate, where required, by the competent authority or after its first occupation, whichever is earlier.

(ii) In case of supply of service mentioned above, involving transfer of property in land or undivided share of land, as the case may be, the value of supply of service and goods portion in such supply shall be equivalent to the total amount charged for such supply less the value of land or undivided share of land, as the case may be, and the value of land or undivided share of land, as the case may be, in such supply shall be deemed to be one third of the total amount charged for such supply.

“Total amount” means the sum total of,-

(a) Consideration charged for aforesaid service; and

(b) Amount charged for transfer of land or undivided share of land, as the case may be.

Value of supply of services in case of a Pure Agent

Subject to fulfilment of certain conditions, the expenditure and costs incurred by the supplier as a pure agent of the recipient of supply of service, has to be excluded from the value of supply.

Illustration : Corporate services firm A is engaged to handle the legal work pertaining to the incorporation of Company B. Other than its service fees, A also recovers from B, Registration fee and Approval fee for the name of the company paid to Registrar of the Companies. The fees charged by the Registrar of the companies registration and approval of the name are compulsorily levied on B. A is merely acting as a pure agent in the payment of those fees. Therefore, A’s recovery of such expenses is a disbursement and not part of the value of supply made by A to B. ( add new constant and removed old)

Rate of exchange of currency, other than Indian rupees, for determination of value

The rate of exchange for determination of value of taxable goods or services or both shall be the applicable RBI reference rate for that currency on the date of time of supply as determined in terms of section 12 or section 13 of the CGST Act.

Value of supply inclusive of integrated tax, central tax, State tax, Union territory tax

Where the value of supply is inclusive of GST, the tax amount shall be determined in the following manner,

Tax amount= (Value inclusive of taxes X GST tax rate in % )/(100+ sum of GST tax rates in %)

For example - If the value inclusive of tax is Rs. 100/- and applicable GST tax rate is 18% then

Tax amount = (100x18)/ (100+18) = 1800/118=Rs. 15.25