Not sure if you need to pay GST under reverse charge on a purchase? The RCM Applicability Checker (GST) tells you instantly whether Section 9(3) or Section 9(4) of the CGST Act applies to what you bought — no guesswork, no digging through notifications.

What Is RCM Applicability Checker (GST)?

The RCM Applicability Checker (GST) is a free tool that tells registered businesses, freelancers, and finance professionals whether reverse charge mechanism (RCM) applies to a specific purchase. It's built for accountants, CAs, company secretaries, small business owners, and finance teams at corporates who handle accounts payable and need a quick, reliable answer before an invoice gets booked.

RCM Applicability Checker (GST) Formula (as per Section 9(3) & 9(4), CGST Act, 2017)

RCM in India runs on two separate legal triggers, and the checker applies both:

Section 9(3) — Notified supply rule:
IF service/goods is on the CBIC notified list (GTA, legal services,
director services, security services, import of services, rent on
commercial property from an unregistered person, metal scrap, etc.)
AND recipient is a GST-registered business entity
THEN recipient pays GST directly to the Government (RCM applies)

Section 9(4) — Unregistered-supplier rule:
IF recipient is a real-estate promoter
AND purchases from GST-registered suppliers < 80% of total inputs
THEN RCM applies on the shortfall
ELSE (any other business buying from an unregistered supplier)
RCM does NOT apply — this blanket rule was suspended in 2018

The current notified list under Section 9(3) sits in Notification No. 13/2017-Central Tax (Rate), as amended. The real-estate 80% rule is under Notification No. 07/2019-Central Tax (Rate).

How This Calculator Works

1. Select what you purchased or received — the tool matches it against the current CBIC-notified RCM categories (for sponsorship, pick the option matching whether the supplier is a body corporate).
2. Confirm whether you (the recipient) are GST-registered — most Section 9(3) categories apply only to registered business entities.
3. Confirm the supplier's registration status where it matters (commercial rent, metal scrap, general purchases).
4. If you're a real-estate promoter, flag it — the 80% procurement rule only applies to promoters.
5. The tool returns one of three verdicts: RCM Applicable, RCM Not Applicable, or Conditionally Applicable, with the exact reason and notification reference.

Step-by-Step Example Calculation

Scenario: A private limited company (GST-registered) engages an individual advocate for a High Court matter and pays ₹80,000 in fees.

• Step 1: Category selected — "Legal services from an advocate / law firm."
• Step 2: Recipient status — Yes, GST-registered business entity.
• Step 3: Supplier status — irrelevant here; legal services from an advocate are on the Section 9(3) notified list regardless of the advocate's own registration.
• Step 4: Result — RCM Applicable. The company must self-invoice, pay 18% GST (₹14,400) directly to the Government via the electronic cash ledger, report it in GSTR-3B Table 3.1(d), and can claim the ₹14,400 as ITC in the same period, subject to eligibility.

Compare this with a freelancer (not GST-registered) hiring the same advocate — RCM would not apply, since Section 9(3) legal-services RCM is triggered only when the recipient is a registered business entity.

Who Should Use RCM Applicability Checker (GST)

• CAs and company secretaries verifying RCM treatment before finalising a client's GSTR-3B
• Small business owners and freelancers who occasionally buy notified services (legal, security, GTA) and need to know their liability
• Corporate accounts payable teams screening vendor invoices for RCM flags before payment
• Real-estate promoters and builders tracking the 80% registered-procurement threshold under Section 9(4)
• NRIs and businesses importing services who need to confirm import-of-service RCM liability

Latest Rules You Should Know (2026)

• Commercial property rent from an unregistered landlord moved under RCM from 10 October 2024 — a major shift for businesses renting office space from individual landlords.
• Metal scrap purchased from unregistered persons was added to the RCM list from October 2024 under Notification 06/2024-CT(R).
• Sponsorship services from a body corporate moved to forward charge from 16 January 2025 (Notification 07/2025-CT(R)) — the recipient now gets a GST invoice directly from the body-corporate sponsor instead of self-invoicing. Sponsorship from an individual or non-corporate supplier to a body corporate/partnership firm still stays under RCM.
• The blanket Section 9(4) rule on all unregistered purchases remains suspended for everyone except real-estate promoters, who still follow the 80% procurement rule under Notification 07/2019-CT(R).

If your business is also adjusting to the revised GST rate structure, Toolisky's GST 2.0 rate guide explains the new 5%/18%/40% slabs that took effect from 22 September 2025.

Common Mistakes People Make

• Assuming RCM applies to every purchase from an unregistered supplier — it doesn't, except for real-estate promoters.
• Forgetting that legal services and director's services attract RCM regardless of the supplier's own GST registration status.
• Missing the October 2024 change on commercial rent from unregistered landlords and continuing to expect the landlord to charge GST.
• Assuming all sponsorship payments moved to forward charge after January 2025 — only sponsorship from a body corporate did; sponsorship from an individual or non-corporate supplier still stays under RCM.
• Not issuing a self-invoice for RCM purchases from unregistered suppliers, which is a separate compliance requirement from the tax payment itself.
• Trying to adjust RCM liability against available Input Tax Credit — RCM must be paid in cash, never through ITC set-off.

FAQs

Can I use ITC to pay RCM liability?

No. RCM must always be paid in cash through the electronic cash ledger. You can claim it back as Input Tax Credit only after the payment is made, in the same or a later return period, subject to standard ITC eligibility conditions.

Does RCM apply if I buy from an unregistered supplier for my regular business?

Generally no, unless you are a real-estate promoter. The blanket Section 9(4) rule on all unregistered-supplier purchases was suspended in 2018 and only real-estate promoters remain covered, subject to the 80% procurement threshold.

Is a self-invoice compulsory for RCM purchases? 

Yes, when the supplier is unregistered and cannot issue a GST-compliant tax invoice, the recipient must issue a self-invoice to support the RCM payment and ITC claim.

Do I need to pay RCM on legal fees even if I'm a small business? 

Yes, if you are a GST-registered business entity receiving legal services from an advocate or law firm, RCM applies regardless of your turnover, since this is a notified Section 9(3) service.

Has GTA remained under RCM after the recent GST changes? 

Yes, GTA services remain on the Section 9(3) notified list, though a GTA can opt to pay tax under forward charge instead — in that case RCM does not apply on that specific GTA's invoices.

Where do I report RCM liability in my GST return? 

RCM tax payable is reported in Table 3.1(d) of GSTR-3B, paid in cash, and the corresponding ITC is claimed in Table 4(A) of the same or a subsequent return.

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