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Reverse Charge Mechanism (RCM) Applicability & Compliance Checklist — GST

Sec 9(3) notified goods/services and Sec 9(4) unregistered-supplier categories tested against the entity's actual transactions, with the self-invoicing and cash-payment requirements that make RCM different from normal ITC.

Free · CORAA original — SA-aligned
Updated 28 Jul 2026
Basis
Sec 9(3) notified categories + Sec 9(4) unregistered-supplier categories
Payment
Cash ledger only — RCM cannot be discharged via ITC set-off
Documentation
Recipient issues a self-invoice for the unregistered-supplier case
Format
Microsoft Word (.docx)
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What’s inside

An excerpt from the template.

REVERSE CHARGE MECHANISM (RCM) APPLICABILITY & COMPLIANCE CHECKLIST

Entity: ___ · GSTIN: ___ · Financial year ended: ___

A. Section 9(3) — notified goods and services (illustrative; verify the current notified list)

B. Section 9(4) — supply from an unregistered supplier to a specified registered recipient

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About this template

What you’re downloading, and when to use it.

This template follows the format published by the Institute of Chartered Accountants of India (ICAI) in the AASB Audit Working Paper Templates (June 2023), the authoritative reference for Indian statutory-audit documentation. Fill in your firm’s letterhead and the engagement details on the form above, click Download Word file, and you’ll get a fully formatted .docx ready to use.

Everything is generated in your browser and on a stateless API endpoint — no account, nothing stored on our servers. We’ll ask for a work email once before your first download so we can send you the file and the occasional relevant update; after that, downloads on this device are instant. Edit freely in Word, Google Docs or Pages before sending to your client.

Common questions

FAQs.

Does RCM apply to every purchase from an unregistered supplier?
No — that is a common misconception. Section 9(4) reverse charge on unregistered-supplier purchases applies only to specifically notified categories (historically limited to certain real-estate-sector inputs), not to all unregistered-vendor purchases generally. Most Section 9(3) RCM categories (GTA, legal services, sponsorship, director services, import of services) instead apply based on the NATURE of the service, regardless of whether the supplier is registered.
Can RCM tax be paid using available input tax credit?
No — GST payable under reverse charge must be discharged only through the electronic cash ledger, not by utilising input tax credit available in the electronic credit ledger. The ITC on that same RCM payment (once made in cash) can then separately be claimed, subject to normal eligibility rules.
What documentation is required for an RCM supply from an unregistered person?
The recipient must issue a self-invoice, since the unregistered supplier cannot issue a valid GST tax invoice. A payment voucher is also required at the time of making payment to the supplier. Both documents are the recipient's own records and should be retained to support both the RCM liability and the subsequent ITC claim.
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