Goods Transport Agency Under GST: Definition, Updates, Services, and Reasons to Pay GST?
AuthorPriyanka Chaudhari
Reviewed ByCA Ajay Savani
- Latest Updates for GTA
- What is the Goods Transport Agency Under GST?
- What is a Consignment Note?
- Why Does the Goods Transport Agency Need to Pay GST?
- What are the Rates Applied on Services of Goods Transport Agency Under GST?
- Scenarios When GTAs are Registered Under GST
- Which Business Pays GST for RCM on Transportation Services?
- Conclusion
Sometimes you pay GST for cross border trade and at times you don’t- ever wondered why this happens? This completely relies on the Goods Transport Agency under GST.
GTA services under GST play a crucial role in streamlining the supply chain processes across the country while staying compliant with complicated tax regulations.
Start reading the blog right away and unfold what is Goods Transport Agency under GST, latest updates, services, and more. Scroll below to read!
Latest Updates for GTA
September 2025
Circular no. 16/2025- depicted a change in the GTA definition where the central tax will exclude eCommerce operators offering local delivery services from the GTA.
January 2025
HSN reporting is needed for GTA services, especially for the ones offering domestic and export trade. Businesses crossing the turnover threshold of ₹5 crore should have 8-digit HSN codes.
What is the Goods Transport Agency Under GST?
Under the GST regime, the Goods Transport Agency (GTA) refers to a transport company that trades goods through roadways and issues a consignment note along with it. In other words, GTA transports goods from one location to another as a consignment.
What is a Consignment Note?
A consignment note typically refers to an official document issued by a GTA while transporting goods through roadways. This receipt is proof of the consignment between the goods transport agency and the consignor.
Core Elements of the Consignment Note
- Unique Serial Number
- Consignor and receiver names
- Vehicle registration information
- Details of Goods Transported
- Starting and end locations
- Details of the individual paying service tax
Why Does the Goods Transport Agency Need to Pay GST?
Goods Transport Agency under GST is exempted from taxes, if the transport is carried by:
- Goods Transport Agency (GTA)
- Courier Service Company
Also, goods transported by waterways are exempted from applying GST.
What are the Rates Applied on Services of Goods Transport Agency Under GST?
| GTA Services | GST rate |
| Tranporting agricultural produce, milk, salt and food grain which are flour, pulses and rice, organic manure, newspaper or magazines registered with the Registrar of Newspapers, relief materials meant for victims of natural or man-made disasters, defence or military equipment | 0% |
| Trading goods, which are considered to be charged for the transportation of goods on a consignment transported in a single carriage is below ₹1,500 | 0% |
| Transporting goods, which are considered to be charged for transportation of all such goods for a single consignee don’t exceed ₹750 | 0% |
| Other goods | 5% No ITC or 12% with ITC |
| Household products used for personal use | 0% |
| Transporting goods of unregistered persons | Initailly exempted, but now are made taxable; currently, list yet to be notified** |
| Transporting goods for taxable individuals who are not registered | Earlier exempted, but later made taxable; currently, list yet to be notified. |
| Transporting goods where GST is paid by GTA | 5% No ITC or 12% with ITC |
| Transporting goods of 7 specified recipients | Irrespective of GTA choosing 12% (with ITC) and 5% (without ITC), if the GTA opts for paying tax on forward charge by giving a yearly declaration^, then it appears in the tax invoice. If that declaration is not given, then GTA has chosen for the reverse charge where the recipient must deposit tax and ITC cannot be availed by the GTA. |
| Hiring out vehicle to a GTA | 0% |
Scenarios When GTAs are Registered Under GST
| Service | Turnover Limits | Who pays the GST |
| Scenario 1 | ||
| Transporting goods of a registered dealer or any of the seven entities mentioned below | 9 lakhs | Registered dealer/ Recipient of services under RCM on GTA services |
| Transporting goods of an unregistered dealer (URD) | 5 lakhs | GTA (liable to pay) |
| Total Turnover | 14 lakhs | Aggregate Turnover is below Rs 20 lakh threshold, GTA not required to register |
| Scenario 2 | ||
| Transporting goods of a registered dealer or any of the seven entities mentioned below | 18 lakhs | Registered dealer/ Recipient of services under RCM |
| Transporting goods of an unregistered dealer (URD) | 4 lakhs | GTA (liable to pay) |
| Total Turnover | 22 lakhs | Aggregate Turnover above Rs 20 lakhs, GTA will need to register as it is providing services to an URD |
| Scenario 3 | ||
| Transporting goods of a registered dealer or any of the seven entities mentioned below | 26 lakhs | Registered dealer/ Recipient of services under RCM |
| Transporting goods of an unregistered dealer (URD) | 0 lakhs | — |
| Total Turnover | 26 lakhs | Aggregate turnover exceeds Rs 20 lakh but GTA is still not required to register as per Notification No. 05/2017 |
Which Business Pays GST for RCM on Transportation Services?
GST is to be paid by the receiver on the GTA services if the Goods Transport Agency doesn’t want pay 6% of central tax rate for road transports.
Based on the circular issued in 2017, the receiver must be located in the taxale area and fall under one of the below category:
- A registered factory
- A society registered
- A co-operative society
- A corporate business
- A partnership firm
- A taxable individual
Conclusion
Goods Transport Agencies under GST form the backbone of India’s supply chain by offering seamless and tax compliant transport services. The blog helps to understand exemptions, when does the GSt apply, and who pays the GST making it easier for GTAs to comply with GST norms.
Save the blog and refer to it before issuing your consignment note. Stay tuned until we publish the next blog.
FAQs on Goods Transport Agency Under GST
1. Is RCM on GTA services applicable under GST?
Yes, RCM is applicable on GTA services, where the GST is paid by recipient of the goods.
2. What is the rate applied on Goods Transport Agency under GST?
6% CGST/SGST is applicable which accounts to 12% cumulative rate, conditioned the GTA agrees to pay the central tax rate.
3. Is RCM on transportation applicable on service charges?
Yes, specific service charges like products served through ecommerce platforms are levied with RCM under GST.
4. How should a GTA pay taxes?
- Online Payment: Registered Goods Transport Agency Under GST can pay taxes through the GSTN portal.
- Offline Payment: A GTA can opt for a payment challan from the portal and pay at narby authroized center.
5. What are the penalties for violating goods transport agency under GST rules?
- Delayed return filing will attract ₹200 as a late fee per day upto ₹5000.
- Incorrect HSN details will charge a fine of ₹10K
- Non-compliance with RCM on GTA services implies late fees and interest rates.
6. What is the full form of GTA?
Goods Transport Agency is the full form of GTA in GST.
7. Who pays the GST while hiring a GTA?
The recipient pays the GST at a rate of 12% while opting for GTA.
About the author
Related Articles
Explore the latest market news, useful resources for business, and Munim updates.
