Transport is one of GST’s special cases. A goods transport agency (GTA) doesn’t work like an ordinary service provider — much of its tax is paid by the customer under reverse charge, and the GTA itself chooses between two rate options. Get the structure right and compliance is simple; get it wrong and liability lands in the wrong place.
How GTA GST works
A goods transport agency is a transporter that issues a consignment note. For GTA services, the tax is often payable by the recipient (the business receiving the transport service) under the reverse-charge mechanism — meaning the customer, not the GTA, pays GST on many consignments. This is the single most important thing to structure correctly.
The 5% vs 12% choice
A GTA can operate at 5% without input tax credit, or opt to charge 12% with full input credit (forward charge). Which is better depends on how much input GST you carry — fuel, vehicles, maintenance. A fleet with heavy input costs may be better off at 12% claiming credit; a lighter operator may prefer 5%. We assess your cost base and set the option that actually saves you money.
Consignment notes and e-way bills
- Issuing proper consignment notes is what defines you as a GTA
- E-way bills accompany the goods; the transporter has responsibilities here too
- Reverse-charge invoices must be documented so recipients can pay and claim correctly
- Pure transport by a non-GTA operator (no consignment note) can be exempt