GST (GOODS AND SERVICE TAX)
- GST is an indirect tax levied on supply of goods and services w.e.f 1st July 2017. It is destination based tax. It has three components-CGST, SGST and IGST.
- CGST-Collected by Central Government on intra-state sale
- SGST-Collected by State Government on intra-state sale
- IGST- Collected by Central Government on intra-state sale
- Under GST regime, a business is required to get itself registered under GST if its
- taxable turnover exceeds minimum exemption limit.
- For certain businesses, registration under GST is mandatory. If business is carried on without registration, it is considered as an offence and heavy penalties are imposed.
A business having offices in multiple states are required to take multiple registrations in all states separately. A business with multiple vertical units in a state may apply for multiple registrations in a state. Each registration acts as separate unit with different GST registration number but under same PAN. Separate records are to be maintained for each registration.
POST REGISTRATION PROCESS
- Once business is registered under GST, some legal compliances are to be done:
- -GST payment and returns are to be filed on monthly, quarterly and annual basis depending on turnover and status of business.
- -Eway bills are to be generated while supplying inter-state goods of value more than Rs 50,000 and intrastate for value of goods more than a limit as specified by that particular state.
- -Tax invoices to be raised for outward supply of goods mentioning requisite details.
BENEFITS OF GST REGISTRATION
- -Supply of goods or services interstate without restrictions.
- -Can avail benefit of taking input tax credit while discharging tax liability on outward supply of goods or services
- -Removing cascading effect
- -Can export goods or services without paying GST just by filing Letter of undertaking or bond with respective jurisdictional office.
- This is the scheme available to small business whose turnover is less than Rupees 1.5 crore (in special category states Rupees 75 lakhs)
- Small business can fulfill legal compliances without hassle and by paying very less amount of taxes.
- No monthly returns. Composite dealer have to file returns on quarterly basis only.
- This scheme is not applicable to service providers, e-commerce sellers, inter-state sellers
EXPORT WITHOUT PAYMENT OF GST
A person registered under GST can export goods or services without paying GST just by filing LUT/ Bond with respective jurisdictional office. Input tax credit refund can also be claimed on input services or goods used while making supply of good/ services for export.