Calculating Place of Supply 

of Services under GST

Let us first understand why an accurate determination of  place of supply is important for businesses. The reasons for this are listed below:

*Wrong classification of supply between interstate or intra-state and vice-versa may lead to hardship to the taxpayer as per section 19 of IGST Act and section 70 of CGST Act

*Where wrong taxes have been paid on the basis of the wrong classification, refund will have to be claimed by the taxpayer

*The taxpayer will have to pay the correct tax along with interest for delay on the basis of revised/correct classification

*Also, correct determination of place of supply will help us in knowing the incidence of tax. As if place of supply is determined as a place outside India, then tax will not have to be paid on that transaction.