Brief overview of GST implementation in India
|Features of GST Model Adopted by India||
|Reason for shifting to GST||
- Unified Market across India
- Remove double taxation
- Seamless flow of tax input Credits
- Complex issues such as division of works contracts resolved
- Increase in threshold limit for registration
- Clarity on valuation and ITC
- Tax limited to value addition
- Refund Mechanism for exporters
- Difficult to determine actual jurisdiction – Place of supply and time of supply.
- Increase in tax rates for service sector
- No Centralised Registration
- No Abatements
- Large number of Procedural and documentation compliances. 3-4 Monthly Returns and 1 Annual Return
- Internal transfer (within branches or units) to attract GST such as Audit and accounting functions
- Services by employer to employee without consideration are taxable.
- If no Payment to Vendor ag. Invoice – Otherwise ITC reversed with interest and penalty.
- Stringent penalty Provisions
- Matching concept – No credit until proper return filed by supplier
- No ITC available against Expenses on Employees:
Food and Beverages
Rent a Cab
- Interest and late payment Penalty part of Consideration for GST.
- Outside GST – Electricity tax, Petroleum and Alcohol.
- Stamp Duty to Continue
Important Concepts under GST
|What is the taxable event under GST||The taxable event under GST shall be the supply of goods and / or services made for consideration in the course or furtherance of business.|
|Supply of Goods|
all forms of Sale, Transfer, exchange, Licence, rental, , lease for consideration and Furtherance of business
Taxable Supply even without consideration are taxable
- Self-supplies (within units of same organisation)
- Inter-state self-supplies such as stock transfers will be taxable as a taxable person has to take state wise registration in terms of Schedule 1(5). even if there is no consideration.
- However, intra-state self-supplies are not taxable.
- Supply To Related or Distinct person
- Employee or
- Import of Services
- Taxable – if from related person even without consideration or furtherance of business
- Between Principal & Agents
Renting of Immovable Property
- Covered under Supply of Services
- Employee to Employer
- Import without Consideration expect from related person
Time of Supply (POT)
Under Reverse Charge Mechanism (RCM)Whichever is earlier
Date of Issue of Invoice, If Invoice is issued within prescribed period
date of completion of service
Date of receipt of payment
Date on which Supplier Receive Payment
Receipt of Invoice
Receipt of Services.
Debit in Books of Accounts.
Payment in bank or books of accountPlace of Supply Intra State – Location of Supplier and place of Supply SameCGST & SGST are applicableInter State (IGST) DifferentSingle Rate is applicable
|Type of Invoices|
|Tax Invoice||Within 30 Days|
|Bill of Supply|
|Rate of Tax||0% Essential|
|GSTR-1 Outward Supply||By 10thof subsequent month|
|GSTR-2 Inward Supply||By 10th – 15th of subsequent month|
|GSTR-3 Monthly Return||By 15-20th of subsequent month|
|GSTR-7 TDS Supply||By 10thof subsequent month|
|GSTR-9 Annual Supply||By 31st Dec from the end of F.Y.|
|Payment of GST||GST PMT -4|
|3 Type of E-Ledgers on GST Common Portal|
|E Tax liability Register||GST PMT -1|
|E Credit Register||GST PMT -2|
|E Cash Ledger||GST PMT -3|
|Late Fee||Rs. 100/- per day max 5000|
For any inquiries or questions regarding GST Contact us at firstname.lastname@example.org or dial 9810414035 or visit our website – www.amitarun.com