RCM Calculator
Calculate your exact GST liability under the Reverse Charge Mechanism instantly. Free RCM calculation online for all notified services under GST.
GTA Freight (5% without ITC to GTA). The recipient pays 5% GST and can claim ITC.
RCM Cash Liability
RCM tax must be paid via Electronic Cash Ledger. Once paid, the full tax amount can be claimed as Input Tax Credit (ITC) in GSTR-3B in the same tax period.
RCM Calculator Online — Free GST Reverse Charge Mechanism Calculator
Our RCM Calculator is a free online tool that helps registered GST taxpayers instantly compute their GST liability under the Reverse Charge Mechanism (RCM). Whether you are a business owner, accountant, tax professional, or CA, this tool makes RCM calculation under GST straightforward and error-free — saving you time and ensuring compliance with the latest GST rules for FY 2026-27.
Under the Goods and Services Tax (GST) framework in India, most transactions follow the forward charge mechanism where the supplier collects GST from the buyer and remits it to the government. However, certain specified categories of goods and services are governed by the Reverse Charge Mechanism, where the recipient of the goods or services becomes liable to pay GST directly to the government — bypassing the supplier entirely. This is where our GST RCM Calculator proves invaluable.
What is Reverse Charge Mechanism (RCM) Under GST?
The Reverse Charge Mechanism (RCM) under GST is defined under Section 9(3) and Section 9(4) of the CGST Act, 2017. Under RCM, the tax liability is reversed — instead of the supplier paying GST, it is the recipient who must pay the tax directly to the government. This mechanism was introduced to bring certain unorganised sectors under the GST tax net and ensure better compliance.
Section 9(3) covers notified goods and services — a specific government-prescribed list where RCM is mandatory, regardless of whether the supplier is registered or unregistered. Section 9(4) applies when a GST-registered person purchases from an unregistered supplier for specified categories.
A critical compliance rule under RCM is that the tax must always be paid in cash via the Electronic Cash Ledger. Unlike regular GST payments, you cannot use Input Tax Credit (ITC) sitting in your Electronic Credit Ledger to settle RCM liability. Once the RCM cash payment is made, you are eligible to claim the full amount as ITC in GSTR-3B in the same tax period — making it effectively tax-neutral for most eligible businesses.
Services Covered Under This RCM Calculation Tool
Our online RCM calculator covers all major service categories notified under GST where the recipient is liable to pay tax. Here is a breakdown:
GTA Freight Services — 5%
Goods Transport Agency (GTA) services for road transportation attract RCM at 5% (without ITC to GTA) or 12% (with ITC). The registered recipient pays CGST + SGST for intrastate or IGST for interstate transactions.
Legal Services by Advocates — 18%
Legal services provided by an individual advocate, a firm of advocates, or senior advocates to any business entity attract RCM at 18%. The receiving business must pay GST directly to the government.
Director Remuneration — 18%
Services by a non-employee director to a company attract 18% GST under RCM. This covers sitting fees, commissions, and other remuneration. The company (recipient) is liable to pay and can later claim ITC.
Sponsorship Services — 18%
Sponsorship services provided to a body corporate or a partnership firm attract 18% RCM. The sponsoring company is the recipient and must pay the GST under reverse charge mechanism.
Import of Services — 18% IGST
Any import of services from a foreign entity where the place of supply is India attracts 18% IGST under RCM. Applies to cross-border consulting, SaaS, software licensing, royalties, and more.
Security Services — 18%
Security guard services provided by any person (other than a body corporate) to a registered person attract 18% GST under RCM. The recipient company pays GST and claims ITC subsequently.
Residential Renting for Business — 18%
Renting of a residential dwelling by a GST-registered person for their residence attracts 18% RCM if the landlord is unregistered. The registered tenant is liable to pay GST under reverse charge.
Worked Example: Reverse Charge on GTA Freight Service
Consider a GST-registered manufacturing company in Pune, Maharashtra that hires a Goods Transport Agency (GTA) to deliver raw materials within Maharashtra for a total freight charge of ₹50,000. The GTA issues a consignment note without charging GST under forward charge (choosing the 5% RCM mechanism without input tax credit).
₹50,000
Paid directly to the GTA transporter₹2,500
CGST: ₹1,250 (2.5%) + SGST: ₹1,250 (2.5%)₹0 (Tax Neutral)
₹2,500 claimed back as ITC in GSTR-3BStatutory 3-Step Compliance Workflow
- Payment to Transporter: The company remits the net freight of ₹50,000 to the transporter without adding GST.
- Cash Tax Deposit: Under Section 9(3), the company reports ₹2,500 under Table 3.1(d) of Form GSTR-3B and discharges it via the Electronic Cash Ledger (not through existing ITC balance).
- Input Tax Credit Claim: Since the freight is utilized in the course or furtherance of business, the company claims ₹2,500 as eligible ITC in Table 4(A)(3) of Form GSTR-3B in the same monthly filing period.
How to Use This RCM Calculator Online — Step-by-Step
- 1Select Service Category: Choose the applicable RCM service from the dropdown — GTA Freight, Legal Services, Director Remuneration, Import of Services, etc. The GST rate auto-populates based on the category.
- 2Enter Invoice / Service Value: Type in the transaction amount in the amount field. The tool uses exclusive GST calculation — GST is computed on top of the base service value.
- 3Choose Intrastate or Interstate: Select 'Intrastate' if supplier and recipient are in the same state (CGST + SGST split 50:50). Select 'Interstate' for cross-state or import transactions (100% IGST applies).
- 4View Instant RCM Results: The RCM Cash Liability panel instantly shows CGST, SGST (or IGST), and the exact total GST cash amount to pay via your Electronic Cash Ledger.
Key Rules for RCM Compliance Under GST
Understanding RCM compliance rules is as critical as the RCM calculation itself. Key obligations every taxpayer must follow:
- →Cash Payment Mandatory: RCM liability must be paid via the Electronic Cash Ledger. ITC from the Electronic Credit Ledger cannot be used to discharge RCM liability.
- →Self-Invoice Required: If the supplier is unregistered, the registered recipient must issue a self-invoice under Rule 36(1)(b) of CGST Rules to support the ITC claim.
- →Time of Supply: For RCM, the time of supply is the earliest of the date of payment or 60 days (goods) / 30 days (specified services) from the invoice date.
- →GSTR-3B Reporting: RCM liability is reported in Table 3.1(d) of GSTR-3B. The corresponding ITC claim goes in Table 4(A)(3) in the same return period.
- →GSTR-2B Reconciliation: RCM invoices from registered suppliers appear in GSTR-2B of the recipient. Always reconcile with GSTR-2B before claiming ITC to avoid mismatches.