GST on Scrap and Used Cooking Oil From 1 November 2026: Reverse Charge, TDS and Registration
From 1 Nov 2026: reverse charge on used cooking oil, plastic, tyre and e-waste scrap, TDS under section 51 and no registration exemption for these suppliers.
Key takeaways: used cooking oil reverse charge
- Used cooking oil reverse charge applies from 1 November 2026 on supplies by unregistered persons to registered persons.
- Plastic, tyre and e-waste scrap are also covered by the new reverse charge entries.
- Suppliers of these goods lose the section 23(2) registration exemption, and section 51 TDS applies between registered persons.
Table of contents
Three notifications dated 27 October 2026 change how GST works for dealers in used cooking oil and certain scrap, with effect from 1 November 2026. They deal with reverse charge, registration and tax deduction at source (TDS). All five product groups below are covered by one or more of these notifications.
Goods covered
| Goods | Tariff heading |
|---|---|
| Used cooking oil | 1518 |
| Waste and scrap of plastics | 3915 |
| Waste and scrap of tyres | 4004 |
| Metal scrap | Chapters 72 to 81 |
| Electrical and electronics waste and scrap | 8549 |
1. Reverse charge (Notification 04/2026-Central Tax (Rate))
The notification amends Notification No. 4/2017-Central Tax (Rate), which lists goods and services on which tax is payable by the recipient under section 9(3). It adds new entries for supplies by any unregistered person to any registered person of:
- Used cooking oil (heading 1518)
- Waste and scrap of plastics (heading 3915)
- Waste and scrap of tyres (heading 4004)
- Electrical and electronics waste and scrap (heading 8549)
So a registered buyer purchasing these from an unregistered seller will have to pay GST under reverse charge from 1 November 2026. The new entries in the notification do not state a rate.
2. No registration exemption for these suppliers (Notification 06/2026-Central Tax)
Issued under section 23(2), this notification amends Notification No. 5/2017-Central Tax. A person supplying any of the five product groups above cannot rely on the exemption from registration granted by that notification. In practice, a dealer supplying these goods should assess whether registration is needed under the usual rules.
3. TDS under section 51 (Notification 07/2026-Central Tax)
This notification replaces clause (d) of Notification No. 50/2018-Central Tax, which lists the persons who must deduct tax at source. The clause now covers any registered person receiving a supply of any of the five product groups from another registered person. The rate, threshold and procedure follow section 51 and the principal notification, which this amendment does not change.
What should businesses do?
- Recyclers, manufacturers and traders who buy these goods should set up reverse charge entries for purchases from unregistered sellers.
- Registered buyers of these goods from registered suppliers should check their TDS obligations under section 51 and file the related return.
- Small scrap dealers who relied on the registration exemption should check whether they now need to register. See our guide on GST registration.
Related: CGST Amendment Rules 2026 and ITC conditions. For GST registration and returns help, see our GST services.
What to do next about used cooking oil reverse charge
Review how used cooking oil reverse charge affects your business: note the effective date, check your records and software, brief your team and keep a copy of the official text on file. Where the position is unclear for your case, take professional advice before filing or changing your process.
Official sources for used cooking oil reverse charge
Always read the original text. You can find notifications, circulars and rules on the CBIC Tax Information Portal and file returns and applications on the GST Portal. This guide on used cooking oil reverse charge is a summary and is not a substitute for the official text.
Frequently asked questions
Is reverse charge now applicable on used cooking oil?
Yes, from 1 November 2026, on supplies of used cooking oil (heading 1518) by an unregistered person to a registered person.
Can a scrap dealer still claim exemption from registration?
Not under Notification 5/2017-Central Tax for supplies of the listed goods, from 1 November 2026, as that notification now excludes persons supplying them.
Who must deduct TDS on these goods?
Any registered person receiving a supply of the listed goods from another registered person falls within clause (d) of Notification 50/2018-Central Tax as substituted.
This article is for general information only and is not tax, legal or financial advice. It is based on the text of the notification or circular as published by CBIC. Rules, rates and criteria change, so confirm the latest position with the official source or a professional before acting.
More in GST
We handle these for individuals, businesses and NRIs across India:
