Steps for Configuring GST Under Reverse Charge:

1. Identify Scenarios for Reverse Charge

• Reverse charge applies to specific goods/services as per GST law, including:
• Unregistered vendors supplying services or goods.
• Import of services or goods notified under reverse charge.

2. Configure Tax Codes and Rates

3. Set Up Tax Types

4. Define Tax Rate Rules

• Navigate to: Setup > India Localization > GST Tax Rate Rules > New
• Configure the following:
• Subsidiary Registration Type: Specify if the subsidiary is registered as Regular, Composition, etc.
• Available On: Set to Purchase Transactions to indicate applicability.
• Vendor Registration Type: Choose Unregistered or Overseas for applicable vendors.
• Reverse Charge: Ensure the checkbox is selected.
• GST Rate: Enter the applicable rate (e.g., 18%).
• HSN/SAC Code: Add the correct classification for goods/services.
• Effective Dates: Specify the Effective From and Valid Until dates to control when the rule applies.

In the vendor record, ensure that the registration type of the required vendor is marked as unregistered or overseas, as applicable. The registration type can be set in the vendor bill matching section under financial subtab of the vendor record.