In a major relief to mutual fund distributors earning less than Rs.20 lakh, the government has deferred implementation of reverse charge mechanism (RCM) for three more months i.e. until September 2018.
The Central Board of Indirect Tax and Custom (CBIC) has notified that the provisions relating to RCM have been deferred for 3 months until September 30, 2018.
This deferment will benefit distributors earning less than Rs.20 lakh who do not have GST registration.
In case you are earning less than Rs.20 lakh, but have GST registration, you can cancel your GST registration. You can cancel your GST registration by visiting this link https://services.gst.gov.in/services/login.
For distributors with GST registration, AMCs continue to follow forward charge mechanism, i.e., AMCs will pay the gross commission to them. These distributors can avail of the benefits of input credit.