Goods and service tax
Goods and Services Tax (GST) is a revolutionary indirect tax reform aimed at establishing a unified national market. Implemented on July 1, 2017, GST registration is determined by the consumption of goods and services, operating as a destination-based tax collected at the point of consumption. This comprehensive system absorbs all existing state and central indirect taxes under the umbrella of GST.
Registration:
To supply goods and products in India, GST registration is mandatory. Upon registration, you are assigned a unique GSTIN (Goods and Service Tax Identification Number), a state-wise, 15-digit identifier issued by the Central Government. This registration not only provides you with a legal identity as a supplier but also allows you to benefit from input tax credit and collect GST from recipients of goods and services.
New GST Limit For Sale Of Goods.
Kindly find the below new GST limit w.e.f 1st April 2019 for sales of goods
Category
For Normal Category States
For Special Category States
Turnover
Exceeds ₹40 lakh
Exceeds ₹20 lakh
Applicability
From 1st April 2019
From 1st April 2019
GST Limit For Service Providers.
There has been no change in threshold limits for Service Providers. Kindly find below the GST limits for service providers -
Category
For Normal Category States
For Special Category States
Turnover
Exceeds ₹20 lakh
Exceeds ₹20 lakh
Applicability
–
–
States Who Opted For The New GST Limit.
1)Normal Category States who opted for a new limit of ₹40 lakh
Andhra Pradesh, Assam, Bihar, Chhattisgarh, Delhi, Goa, Gujarat, Haryana, Himachal Pradesh, J&K, Karnataka, Madhya Pradesh, Maharashtra, Odisha, Punjab, Rajasthan, Tamil Nadu ,Uttar Pradesh, West Bengal
2)Normal Category States who choose status quo
Kerala and Telangana
3)Special Category States who opted for new limit of ₹20 lakh
Arunachal Pradesh, Meghalaya, Mizoram, Manipur, Nagaland Puducherry, Sikkim, Tripura, Uttarakhand
The registration for GST is mandatory for the following categories of businesses:
Interstate suppliersCasual Taxable personsTaxes when embassies make purchasesSupplies to developers and units in special economic zonesAccrued input tax credit on account of inverted duty structureRefund of pre-depositArising from order, judgment, direction or decree of the Appellate Tribunal, Appellate Authority or any court of lawFinalization of provisional assessmentExcess payment because of an errorDue to issuance of refund vouchers for taxes paid on advances against which commodities or services haven’t been suppliedRefunds to overseas tourists of GST paid on commodities within the country and carried to an international location when they depart IndiaRefund of SGST and CGST paid by considering the supply in the course of inter-state commerce or trade
Voluntary GST Registration
conveys that businesses not mandated to register under the Goods and Services Tax (GST) have the option to voluntarily register. Despite lacking a compulsory obligation, these businesses choosing voluntary registration are subjected to all provisions applicable to registered entities under the new tax regime. This implies that they willingly assume the responsibilities and privileges associated with GST registration, demonstrating a proactive approach to comply with the tax regulations.
Opting for voluntary GST registration offers businesses several advantages.
Facilitating Input Tax Credit:
By legally registering under GST, businesses can issue taxable invoices, enabling their customers to claim input tax credit on their purchases. This not only expands the customer base but also enhances competitiveness, as buyers are inclined to engage with businesses that facilitate this benefit.
Liberating Inter-State Sales:
GST registration empowers businesses to engage in more straightforward inter-state sales. This liberation in trade not only widens the potential market, especially beneficial for small and medium-sized enterprises, but also fosters economic growth by facilitating seamless transactions across state borders.
Optimizing Input Tax Credit Opportunities:
Voluntarily registered entities can leverage the option to avail input tax credit not only on goods but also on various input services such as consultation fees and legal expenses. This strategic approach enhances overall profitability and business margins, providing a financial advantage.
Enhancing Business Standing:
Businesses registered under GST find it easier to secure premises for rent and obtain loans from banks due to a favorable compliance rating. This not only streamlines operational aspects but also elevates the standing of the business in various facets of commercial engagement.
In summary, voluntary GST registration offers businesses a spectrum of benefits,
"Jain TaxTech guides clients in securing GST registration, identifying voluntary registration opportunities, and outlining associated advantages."
Refunds:
In the realm of GST refunds, a crucial aspect emerges when the payment exceeds the actual GST liability, necessitating a refund claim. To streamline this process and eliminate confusion, a standardized online procedure has been established, complete with stipulated timeframes. Any individual seeking a refund of tax, interest, or any other amount can submit an application within two years from the relevant date. Notably, registered entities can include refund claims while filing their GST returns, particularly if it pertains to the balance in the electronic cash ledger. For exports, the application is contingent upon the delivery of export manifests or reports under the Customs Act, 1962, post which the refund process can be initiated.
Exports of Goods or ServicesDeemed ExportsPurchases by EmbassiesSupplies to Developers and Units in SEZAccrued Input Tax Credit due to Inverted Duty StructureRefund of Pre-DepositArising from Orders, Judgments, Directions, or DecreesFinalization of Provisional AssessmentExcess Payment due to ErrorRefund Vouchers for Advances with Unsupplied Goods or ServicesRefunds to Overseas TouristsRefund of SGST and CGST for Inter-State Commerce or Trade
What’s New in Refund under GST?
What is the Rate of Interest for Refund?
In Case Rate P.A.
Refund is withheld* 6
Refund of any unutilized input tax credit at the end of any tax period 24
Other Cases 18
Interest on Delayed Refund# 6
Interest on Delayed Refund$ 9
In cases where a refund is linked to an order under appeal or pending proceedings, and the Commissioner believes that granting the refund might negatively impact revenue due to malfeasance or fraud, the Commissioner can, after providing the taxable person with an opportunity to be heard, temporarily withhold the refund until a determination is made.
*If the tax is not refunded within 60 days from the date of the order of refund
If the refund is due after the final decree or order, and the refund has not been paid within 60 days
Returns:
A GST return is a crucial document that encapsulates details regarding a taxpayer’s transactions, encompassing both supplies and services, including inward and outward movements. This comprehensive record also incorporates information about Input Service Distribution (ISD) and tax deductions or collections, such as TDS/TCS, as mandated by the prevailing GST laws.In adherence to the GST framework, a regular taxpayer is obligated to submit three monthly returns: GSTR-1, GSTR-2, and GSTR-3, in addition to an annual return. Each of these returns serves a distinct purpose in capturing various facets of a taxpayer’s transactions.
Return Filing Process
GSTR-1 Sales Return 10th of next month. Seller provides details of outward supplies.
GSTR-2A Auto Drafted Purchase Return 11th of next month. Buyer views the details, makes modifications if required.
GSTR-2 Purchase Return 15th of next month. Buyer approves details of GSTR-2A.
GSTR-1A Sales Return 17th of next month. Seller approves/ disapproves changes made by the buyer.
GSTR-3 Auto-drafted Consolidated Return 20th of next month. Final monthly return on the basis of finalized details.
What is the due date of GST returns?
Return Form
Particulars
Frequency
GSTR-1
Details of taxable outward supplies.
10th of the next month
GSTR-2
Details of taxable inward supplies for claiming input tax credit.
15th of the next month
GSTR-3
Monthly return based on finalized details of outward and inward supplies, including tax payment.
20th of the next month
GSTR-3B
Summary return for outward supplies, input tax credit, and tax payment.
Monthly
GSTR-4
Return for composition levy taxpayers.
18th of next month following end of quarter
GSTR-5
Return for non-resident foreign taxable persons.
Last day of registration
GSTR-6
Return for Input Service Distributors.
13th of next month
GSTR-7
Return for tax deducted at source.
10th of next month
GSTR-8
Details of supplies via e-commerce and tax collected.
10th of next month
GSTR-9
Annual return for normal taxpayers.
31st December following F.Y.
GSTR-9A
Annual return for composition levy taxpayers.
31st December following F.Y
GSTR-10
Final return after cancellation, covering all transactions until cancellation date.
3 months from cancellation or order
"At Jain TaxTech, we manage the complete indirect tax compliance life cycle for your company. Our services include data extraction, GST standpoint validation, field verification, and return filing. We specialize in identifying mismatch reasons and seamlessly updating your software for a hassle-free experience."
Do You Know?
Penalty for Late filing of GSTR 3B is Rs. 50 per day.
Consultancy & Advisory
GST advance ruling:
Our consultancy focuses on facilitating GST advance rulings—a vital service providing written interpretations of tax laws. Tailored for corporations and individuals, it clarifies uncertainties before proposed activities. This proactive approach ensures a clear understanding of tax implications, promoting informed decision-making. By seeking official interpretations in advance, clients navigate the tax landscape confidently, fostering compliance. Our commitment lies in empowering clients with the knowledge needed for sound decisions in the dynamic realm of tax regulations.
Advance Ruling is available for the following categories:
Goods/Services Classification: Clarification on the classification of goods and/or services under the GST Act.
Notification Impact: Assessment of the impact of notifications influencing tax rates.
Supply Time and Value: Determination of the time and value for the supply of goods/services.
Input Tax Credit Eligibility: Guidance on the eligibility of input tax credit, including circumstances where it is deemed to be paid.
Tax Liability Assessment: Evaluation of the liability to pay tax on specific goods or services.
GST Registration Need: Confirmation on the necessity of GST registration for the applicant.
Supply Determination: Clarification on whether particular actions by the applicant regarding goods/services will be considered a supply.
Are the services provided by your organization subject to taxation or exempt from taxes?
While the implementation of GST has been successful and seamless, it’s essential to acknowledge the ongoing evolution of GST laws. The regulatory landscape is dynamic, marked by frequent changes through notifications, circulars, and press releases. This continuous evolution has resulted in a shift in the taxation status of services, with some transitioning from taxable to exempt, and vice versa. In this dynamic environment, registered entities require ongoing opinions and day-to-day consulting support to navigate these changes effectively. Our services aim to provide timely insights and support, ensuring businesses stay compliant and well-informed amidst the evolving GST scenario.
"Jain TaxTech: Advisors understanding your business, offering tailored, effective solutions."
Reverse Charge Mechanism (RCM):
“In standard transactions, suppliers bear the tax burden. In Reverse Charge, recipients shoulder tax responsibility, signifying a reversal in chargeability.”
Curious about services under Reverse Charge Mechanism (RCM)?
Contact us for details
Whether to go for Composition scheme or Regular supply?
The Composition scheme, designed for small businesses, serves as a welcome relief by easing the compliance burden imposed by the law. This option allows businesses to pay a fixed percentage of their turnover as fees instead of navigating through detailed compliance provisions. Typically, those supplying goods and services directly to end consumers opt for the Composition levy. Jain TaxTech simplifies GST compliance by assessing the suitability of the special scheme GST registration, highlighting associated benefits, and facilitating registration when applicable. When faced with the decision of whether to opt for the Composition scheme or follow regular supply, these questions require careful consideration and guidance from tax professionals to make an informed choice based on the specific needs and circumstances of the business.
Electronic invoicing or E-invoicing:
Electronic invoicing, or E-invoicing, is a strategic initiative aimed at countering tax evasion and will be introduced in phases. Businesses falling below a specific threshold will receive a unique number for each generated e-invoice. This process involves submitting pre-generated standard invoices on a common portal. In this system, B2B invoices undergo electronic authentication by GSTN, streamlining processes and enhancing transparency on the common GST portal.
The criteria for the applicability of E-invoicing are outlined as follows.
E-invoicing became available on a voluntary basis from January 1, 2020. The implementation of E-invoicing is being carried out in phases by GSTN.
Mandatory generation of E-invoices began on April 1, 2020, for businesses with a turnover of Rs. 100 Crores or more.
Effective April 1, 2020, suppliers with an aggregate turnover exceeding Rs. 500 Crores are obligated to include the Quick Response (QR) code on B2C invoices.
E way Bill:
The E-Way Bill, an acronym for Electronic Way Bill, serves as a distinct electronically generated document for the movement of goods valued at more than Rs. 50,000, whether within a state or between states, as mandated by the current GST regime. This digital document assigns a unique Electronic Way Bill Number (EBN) to the supplier, recipient, and transporter upon generation. The E-Way Bill has replaced the traditional physical Way Bill used in the VAT regime, streamlining and digitizing the process of tracking and documenting the movement of goods.
When should an E-Way Bill be issued?
The generation of the e-Way Bill is ideally done prior to the initiation of the movement of goods valued at Rs. 50,000 or more, encompassing both individual and consolidated invoices for multiple consignments. This applies to the movement of goods related to supply or other reasons such as returns, as well as inward supply from an unregistered person. In the context of an e-Way Bill, the concept of supply includes payments made in the course of business, those outside the regular business transactions, and instances where no consideration or payment is involved, such as in the case of barter or exchange.
format for the GST E-Way Bill?
FORM GST EWB-01
See rule 138)
E-Way Bill
PART – A
A.1
GSTIN of Recipient
A.2
Place of Delivery
A.3
Invoice or Challan Number
A.4
Invoice or Challan Date
A.5
Value of Goods
A.6
HSN Code
A.7
Reason for Transportation
A.8
Transport Document Number
PART – B
B
Vehicle Number
GST Annual Return:
The GST Annual Return, known as GSTR 9, is a yearly filing requirement for registered taxpayers. This comprehensive document encapsulates details of all supplies made and received across various tax heads (CGST, SGST, UTGST, and IGST) throughout the year, including turnover and audit specifics. Additionally, for taxpayers with a turnover exceeding Rs. 2 Crores, the government has introduced the GSTR 9C audit form. This form serves as a reconciliation statement, aligning the information provided in GSTR 9 with the audited annual financial statements of the taxpayer. It ensures a comprehensive and accurate representation of the financial activities undertaken during the fiscal year
Do You Know?
Annual Return - Information required to be disclosed
Annual Return – Information required to be disclosedTaxable/Exempted Outward SuppliesTax Liability and Tax PaymentsDebit / Credit Notes + Any AmendmentsSupplies to developers and units in special economic zonesRefund/ Litigation, if anyInput Tax CreditsInward supply from Composition Dealers, goods sent on approvalHSN Details – Inward/Outward