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WHAT IS GST (Goods and Service Tax)?
It's an integrated and indirect tax, introduced by the Government of India on 1st July 2017. It was introduced to replace numerous indirect taxes like Central Excise Duty, Service Tax, Surcharges, VATs, and Octroi prevailing throughout the nation. Its sole purpose is to eradicate "Double Taxation." It has made the process of doing business simple and is bringing more and more people under the tax bracket.
Model For GST
It is levied on many goods and services barring some exemptions. India has adopted the dual model for GST. Here, GST is levied at every sale-point throughout the nation. For inter-state sales, Integrated GST(IGST) is collected, and on intra-state sales, tax is split equally among State and Centre viz. (CGST) and (SGST).
Tax slabs
Commodities and Services under the GST regime are taxed under five slabs.
28% slab
Around 200 commodities like Automobile, Vaccum cleaner, Panmasala, etc. are taxed at 28%.
Few services like racing, betting, and bills of 5-star hotels are also charged at 28%
12% slab
Items like butter, ghee, cheese, medicine, umbrella, etc. are charged at this rate.
Services like movie tickets below INR 100 are taxed at this rate.
No tax
Goods like sanitary napkins, Rakhis, vegetables, bread, salt, curd, sindoor, printed books, newspaper etc. are not charged under GST
Services like saving Accounts charges under Jandhan schemes, and hotels with tariff below INR 1,000.
Note: Following goods are exempted from the GST
Alcohol for human consumption
Petroleum and its products
18% slab
Almost all the services like catering, hotels, telecom services, education services, financial services etc. are taxed under this sab at 18%.
A large number of products are also taxed under this slab. These products include items like a water heater, washing machine, deodorants, suitcase, mineral water, perfume, wristwatches and many more.
5% slab
Essential goods like skimmed milk, frozen vegetable, coal, fertiliser, insulin, cashew nuts, ayurvedic medicines etc. are taxed at 5%.
Services
Small A.C and Non A.c restaurant whether they are serving alcohol or not, takeaway foods, etc. are charged at 5%.
Registration
Registration & Aggregate Turnover Limits for GST registration
GST registration
GST is one of the boldest tax reform introduced by the Government Of India. After it's introduction and implementation, it has become critical for businesses to get registered under this act. Government has proposed various eligibility criteria and necessities for the registration under this act. Let's discuss them in detail.
Voluntary Registration
Any individual or a business can apply for the GST registration voluntarily. GST act allows such an application even if their aggregate turnover is below the threshold limit.
For Goods Supplier
Any entity, involved in the process of supplying goods with the aggregate turnover of more than 40 lakhs has to register under the GST regime. Although, few goods are exempted from the GST and entities involved in their supplies do not need to get registered under the GST.
For Service Provider
Any entity involved in the business of supplying services with the aggregate turnover of more than 20 lakhs has to register under the GST regime. Few services are exempted under the GST law and entities involved in the supply of these services do not have to register themselves under the GST.
Required Documents
► PAN card of the applicant
► Photograph [ Passport-sized photograph of the Sole Proprietor in the sole proprietorship, a photo of partners/authorized signatory in a Partnership firm or LLP, Karta of HUF, Managing Director, director or authorized person, Trustees for a trust, or any other person in charge for companies. ]
► ID proofs of individuals mentioned above for the respective entities.
► Address Proof [ Address proof for the principal and additional places (if any) of the business is necessary. If the site is on rent, rent agreement is required, if the place is given by consent, then a consent letter with the id proof of the person giving consent and proof of his/her ownership has to be submitted. ]
► For businesses operating from SEZ [ documentations issued by the Central Government has to be submitted.]
► Proof of Ownership [ If the applicant owns the premise, then proof of ownership has to be submitted.]
► Bank account details [ Details like account number, IFSC, and Bank name, a copy of canceled cheque with the name of the applicant or first page of passbook having all the details mentioned above.]
Choose Probal Consulting Group for uninterrupted and prompt services!
Managing all your GST compliances can be a challenging task. It's better to hire a team of GST experts to manage all these tasks efficiently. Since the inception of GST, we have helped a large number of business entities in managing their accounts efficiently.
A GOOD START IS THE WORK HALF DONE !!!
Frequently asked questions
Yes, the GST law mandates that if you are making interstate supply, then you are liable for the GST registration, irrespective of your aggregate turnover.
No, if you are doing Business from a single state, you will need only one registration. You can choose your business category while making an application. Still, you have an option to register both businesses as separate businesses.
You have 30 days to file for an application after you become liable for the GST registration.
You cannot claim or collect ITC if you are not registered under the GST regime.
No, GST law mandates that you need a separate registration under the GST regime to operate in two states. Even if you are using the same PAN, you will need two different registration for two different states.
Numerous small business owners with their turnover below the aggregate limit, face this dilemma time and again. But we highly recommend you to obtain the registration for many reasons.
Even if your aggregate is below the turnover limit, many firms don't work with the businesses without GST registration. So it's always advisable to register yourself under the GST regime.
You can claim an input tax credit(ITC) for all the purchases you make for your business.
Related Services
Propel your business with Probal Consulting Group.
Kick-start your business with our full-suite accounting and legal services.
Every supplier registered under the GST law has to file various returns regularly. Period of filing returns and the type of returns are based on the nature of business. GST returns can be filed online via GST portals.
Surrendering your GST registration could be a challenging task. Various criteria need to be satisfied before the Cancellation of GST registration
