- Not all ongoing or long-term services are automatically classified as “continuous supply of services” under GST.
- Classification as continuous supply requires four conditions: continuous/recurrent provision, a contract, contract duration over three months, and periodic payment obligations.
- This classification affects invoicing timing, tax liability, and compliance; incorrect classification can lead to premature tax, interest, and disputes.
- Section 2(33) of the CGST Act provides the legal definition and criteria for continuous supply of services.
Source: taxtmi.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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