Comprehensive List of RCM Services Under GST in India (2025)

Are you working with some unregistered suppliers? Did you know you might have to pay taxes on their behalf if they fall under the Reverse Charge Mechanism (RCM) services? 

This article lists the RCM services that will help businesses work smoothly with unregistered and unorganised supply chains.  

A Simple Explanation of the Reverse Charge Mechanism Under GST

While dealing with certain services specified by the CBIC or unregistered vendors, the buyer has to self-invoice for the purchases made. As the chargeability gets reversed, it’s known as the reverse charge mechanism. 

You can understand the rules behind RCM by referring to:

• Sections 9(3), 9(4), and 9(5) of Central GST and State GST Acts for intrastate transactions
• Sections 5(3), 5(4), and 5(5) of the Integrated GST Act for inter-state transactions. 

The objective of shifting the GST burden to the recipients is to widen the scope of taxes levied on different unorganised sectors. Only certain types of business entities are subject to RCM, such as imports, purchases from unregistered dealers, and the supply of certain notified goods and services.

Let's understand how it works.

Imagine you hire a plumber to fix a water leak at your shop. Normally, when you buy something, the seller adds GST to the bill and pays it to the government.

However, under the Reverse Charge Mechanism (RCM), the plumber does not charge you GST. Instead, you (the shop owner) must calculate the GST and pay it directly to the government.

List of Services Under RCM in GST

As per the latest GST amendments, the following services are subject to RCM under GST:

Goods Transport Agency (GTA) Services

RCM applies when a GTA provides transportation of goods by road and:

• Charges 5% GST (without claiming input tax credit).
• Issues a tax invoice.
• Has not opted for forward charge (i.e., has not submitted the yearly declaration for forward charge).

Recipient liable under RCM if they fall under any of the following:

• Factories (under Factories Act, 1948)
• Societies (registered under Societies Registration Act, 1860)
• Co-operative societies
• GST-registered persons
• Companies or body corporates
• Partnership firms (registered or unregistered)
• Casual taxable persons

If GTA charges 12% GST with ITC, RCM does not apply.

Legal Services by Advocates

Services by an individual advocate, senior advocate, or a law firm (including LLPs) to any business entity attract RCM.

This includes all advisory, consultancy, and representation services in courts, tribunals, or authorities.

• Supplier: Advocate or law firm
• Recipient (liable under RCM): Any business entity located in taxable territory
• GST Rate: 18%

Services by Arbitral Tribunals

• Supplier: Arbitral Tribunal
• Recipient: Any business entity
• GST Rate: 18% (under RCM)

Sponsorship Services

If any person provides sponsorship services to a body corporate or partnership firm, the recipient must pay GST under RCM.

Services Provided by Government or Local Authorities

If the Central/State Government, Union Territory, or Local Authority provides services to a business entity, RCM applies.

Exclusions (RCM does NOT apply to these government services):

• Renting of immovable property (except when to a registered person)
• Postal services like speed post, express parcel, life insurance, or agency services provided to non-government entities
• Services related to aircraft/vessels within/outside airport/port
• Transportation of goods or passengers

Additional inclusions:

• Renting of immovable property to a registered person
• Renting of residential dwelling to a registered person
• Transfer of development rights or FSI (including additional FSI) for construction by a promoter
• Long-term lease of land (30+ years) for construction by a promoter

Services by Company Directors

When a director of a company provides services to the company, the company must pay 18% GST under RCM.

Services by Insurance Agents

If an insurance agent provides services to an insurance company, the insurance company must pay 18% GST under RCM.

Services by Recovery Agents

If a recovery agent provides services to a bank, financial institution, or non-banking financial company (NBFC), the recipient must pay 18% GST under RCM.

Copyright-Related Services

When creators (like authors, photographers, music composers, or artists) transfer or permit the use of copyrights, the recipient must pay GST under RCM.

Two categories:

• To music company, producer, etc. → 12% GST
• To publisher (literary works) → RCM applies only if the author hasn’t opted for forward charge by declaration.

Services by Members of the Overseeing Committee to RBI

If members of the Overseeing Committee (constituted by RBI) provide services to the Reserve Bank of India, these services are exempt from GST. This means RBI does not have to pay GST under RCM, and the committee members do not charge GST on their services.

Services by Individual DSAs

Services by individual Direct Selling Agents (not companies or firms) to banks or NBFCs fall under RCM.

Business Facilitator Services to Banks

Services provided by business facilitators to banks are taxable under RCM.

Business Correspondent Agent Services

If an agent of a business correspondent provides services to a BC (business correspondent), the BC must pay GST under RCM.

Security Services (Other than by a Company)

Security services provided by non-body corporates (e.g., individuals, firms) to registered persons are covered under RCM.

Exceptions:

• Government departments/agencies registered only for TDS under Sec. 51
• Persons registered under the Composition Scheme

Renting of Motor Vehicles

If a non-body corporate rents a motor vehicle to a body corporate and opts for 5% GST (without ITC), then the recipient pays GST under RCM.

Lending of Securities (SEBI Scheme)

Under SEBI’s Securities Lending Scheme, if a person lends securities via an approved intermediary, the borrower pays GST under RCM.

Radio Taxi or Cab Services via E-Commerce Platforms

When a driver provides taxi services through an e-commerce operator (like Uber/Ola), the platform is liable under RCM.

Accommodation Services via E-Commerce Operators

Accommodation services (hotels, lodges, clubs, campsites, etc.) provided through e-commerce platforms are taxed under RCM, unless the service provider is required to register under GST.

Housekeeping Services via E-Commerce Operators

Home services (like plumbing, carpentry) provided through platforms are also taxed under RCM, unless the service provider is required to register.

Additional IGST Services under RCM

These apply when the supplier is located outside India:

1. Any service by a person in a non-taxable territory (other than to a non-taxable online recipient).

• Recipients in India pay IGST under RCM.

2. Import of goods by vessel from a place outside India up to customs clearance in India.

• Importers pay 5% IGST under RCM.