RCM Entry 14: Security Services and Its Two Exclusions

RCM Entry 14 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.

Entry 14 is short, and every word in it is load-bearing. It applies to a particular service, from a particular kind of supplier, to a particular kind of recipient — and it then writes two exclusions into the entry itself rather than leaving them to the exemption notification.

Entry 14 of Notification No. 13/2017-CT(Rate), inserted by Notification No. 29/2018-CT(Rate) dated 31.12.2018 w.e.f. 01.01.2019, covers "security services (services provided by way of supply of security personnel) provided to a registered person", where the supplier is any person other than a body corporate and the recipient is a registered person located in the taxable territory. The entry itself excludes (i) a government Department or Establishment, local authority or Governmental agency registered only to deduct tax under section 51, and (ii) a registered person paying tax under section 10 — a composition dealer. Where the supplier is a body corporate, or the recipient is unregistered, it is forward charge.

The four elements

One — the service must be the supply of security personnel. The entry defines itself parenthetically: "services provided by way of supply of security personnel". The Handbook adds a warning in a single line: "Supply of manpower is different from supply of security service." A general manpower supply contract — housekeeping, drivers, clerical staff, technicians — is not Entry 14 material, and treating it as such produces a reverse charge payment on a supply that the contractor was required to charge.

Two — the supplier must not be a body corporate. A proprietorship, a partnership firm, an LLP, an AOP, a trust or a society supplying security personnel is inside the entry. A security company — the large organised players in the sector — is outside it and charges GST in the ordinary way. The Handbook states the converse expressly: "GST shall be payable under forward charge mechanism on security services in case such services are supplied by body corporate or supplied to the unregistered persons."

Three — the recipient must be a registered person located in the taxable territory. Note that this limb turns on registration, not on being a business entity, and not on any threshold.

Four — neither exclusion applies.

The two exclusions inside the entry

Exclusion (i): the TDS-only government registrant. The entry does not apply to a Department or Establishment of the Central Government, State Government or Union territory, a local authority, or a Governmental agency which has taken registration under the CGST Act only for the purpose of deducting tax under section 51 and not for making a taxable supply of goods or services.

This is the same carve-out that appears in Entry 1 for GTA services, and for the same reason — a body registered solely as a tax deductor is not a taxpayer in the ordinary sense, and loading reverse charge onto that registration serves no purpose.

Exclusion (ii): the composition dealer. The entry does not apply to "a registered person paying tax under section 10 of the said Act".

This exclusion is unusual and worth pausing on. Reverse charge in a composition dealer's hands is paid at the ordinary rate, from the electronic cash ledger, with no credit under section 10(4) — it is a pure cost, not a timing item. A guard at the shop is among the commonest inputs of the smallest businesses, and applying Entry 14 to them would have imposed a full-rate, no-credit cost on exactly the taxpayers the composition scheme exists to relieve. The exclusion, together with the parallel composition carve-out from Entry 5AB made by Notification No. 07/2025-CT(Rate) w.e.f. 16.01.2025, gives a composition dealer relief on two of its commonest inputs — the guard, and the shop.

Do not generalise from them. They are entry-level exclusions in a specific notification, not a principle. A composition dealer remains liable under the rest of the section 9(3) list — GTA freight, legal services and the others — without relief. Reverse charge and the composition dealer →

Contract for services, not contract of services

The Handbook makes a distinction that decides some of the harder security files:

"Security services contracts are (i) contracts for services with list of guards to be deployed or (ii) contract of services with list of guards to be deployed specified to measure consideration payable. RCM is applicable only when the contract is for 'contract for services'."

The distinction is the familiar one between engaging an independent contractor and engaging labour under the recipient's direction. Where the contract is one for services — the agency undertakes to provide security, deploys and controls its own personnel, and the guard list merely describes the deployment — Entry 14 applies. Where the arrangement is in substance a contract of service, with personnel working under the recipient's control and the guard list functioning merely as a measure of the consideration, the character of the supply is different and the entry does not fit.

In practice the drafting and the operational reality must agree. A contract labelled as a service contract but administered as if the guards were the recipient's own staff invites the argument either way.

The exemption that removes the question: educational institutions

Entry 66(b)(iii) of Notification No. 12/2017-CT(Rate) exempts services provided to an educational institution by way of security services performed in such educational institution.

Where the exemption applies there is no levy to shift. As the Handbook states as a general proposition, if output tax is not payable under section 9(1) then there can be no liability to discharge under RCM. A school or college receiving security services within its premises therefore has no Entry 14 liability, whatever the supplier's constitution.

Read the entry's own limits, though. The exemption is for security services performed in the educational institution, and the scope of the exemption for particular categories of institution should be checked against the full text of entry 66.

The compliance chain

Security agencies below the registration threshold are common, so the unregistered-supplier route is the usual one:

• Self-invoice under section 31(3)(f) on the date of receipt of the service;
• Payment voucher under section 31(3)(g) at the time of payment;
• Time of supply under section 13(3) — earliest of payment entered in the books or debited to the bank account, the day after sixty days from the supplier's invoice where the supplier is required to issue one, or the date of the recipient's own invoice where the recipient issues it;
• Payment in cash under rule 85(4); credit in the same month if otherwise eligible, security of business premises being an input service used in the course or furtherance of business;
• Reported in Table 3.1(d) of GSTR-3B, credit in Table 4(A)(3), annually in Table 4G with the credit in Table 6C or 6D.

Key takeaways

• Entry 14 covers the supply of security personnel only — manpower supply is a different service.
• The supplier must be other than a body corporate; a security company charges forward.
• The recipient must be a registered person; supply to an unregistered person is forward charge.
• The entry excludes a TDS-only government registrant and a composition dealer paying tax under section 10.
• The composition exclusion, with the Entry 5AB exclusion from 16.01.2025, relieves the smallest taxpayers on their two commonest inputs.
• RCM applies to a contract for services, not to what is in substance a contract of service measured by a guard list.
• Entry 66(b)(iii) exempts security services performed in an educational institution.

Read next

• RCM Entries 5A, 5AA and 5AB: Renting of Immovable Property
• RCM Entry 15: Renting of a Passenger Motor Vehicle
• Reverse Charge and the Composition Dealer

Disclaimer: Positions stated as on 5 September 2026, based on entry 14 of Notification No. 13/2017-Central Tax (Rate) as inserted by Notification No. 29/2018-Central Tax (Rate) dated 31 December 2018, entry 66(b)(iii) of Notification No. 12/2017-Central Tax (Rate), and section 10(4) of the CGST Act, 2017, as reproduced in the ICAI Handbook on Reverse Charge under GST (2nd edition, February 2025).