GST is a combination of Central and State Taxes and it was introduced to bring one tax system in India, a concept developed by Bharatiya Janta Party (BJP) under the rule of Shri Narendra Modi, the Prime Minister of India. Here in this article, we go through What is GST? Different GST Tax Slabs and GST Filing for business and how to prepare for it.
What is GST?
GST stands for Goods and Service Tax. This is a unique indirect tax for the entire nation, which will make India an integrated general market. GST will unite it directly to the manufacturer to supply products and services to consumers.
We have also published an infographic detailing more about GST here –
Types of Taxes under GST
There will be three types of taxes under GST –
- IGST (Integrated GST) for Central GST and
- State GST and Interstate Transactions for Interstate Transactions
Since all central and state taxes have been merged and have been reported as a Tax for GST, State Governments and Central Government should be their GST share. Therefore there will be three types of tax under GST.
Since GST is a tax on the basis of consumption, tax revenue will be levied and taken for consumer state. This helps the consumer state to protect its taxable base.
If goods are transferred within the state, that is, the state of consumption is the same as the state of origin, there will be CGST (Central Government Tax) and SGST (Levy from the state government) If the goods are transferred from one state to another, the IGST will be imposed and the central government will resolve the tax to the consumer state.
Will GST Bring Down by Tax Burden?
The GST aims to eliminate the cascading tax effect. You can use all incoming loans and reduce the tax burden due to the use of credit. The loan can only be claimed after it corresponds to the invoices of the appropriate suppliers. In the current tax system, receivables for tax credits are not permitted under various tax laws.
For example tax credits at the expense of taxes payable by special taxes cannot be claimed from the quota for services and vice versa.
Will GST Increase my Compliance
The GST aims to reduce the burden of compliance of users. There is only one fulfillment that you need and you only have to do one fulfillment. In the current regime, service taxes, VAT and other income must be presented separately, while the income tax mechanism is different for each tax.
In GST, reports are prepared by GSTN when the assessee enters all the details of the purchase and sale. The invoice agreement for the use of credit for entry is done automatically and the return is being prepared.
After processing and approval, there is no other refund that is submitted on a monthly basis. Customers must submit and manage all taxes separately for excises, VAT, Service taxes, etc.
GST Tax Slab Rates
GST has proposed a total of 4 tax slabs:
- Exempted categories – 0
- Commonly used Goods and Services – 5%
- Standard Goods and Services fall under 1st slab – 12%
- Standard Goods and Services fall under 2nd Slab – 18%
- Special category of Goods and Services including luxury – 28%
Note: The rates are subject to change
How Do I Pay my GST Liability
Once we have completed the income statement, the tax is calculated on the basis of the liability arising from the sales invoices submitted after the adjustment of the current tax credit, which must be paid. Loans will benefit in the following way.
Order of utilization of credits:
- CGST – CGST and then IGST
- SGST – SGST and IGST
- IGST – IGST, CGST, and SGST
Preparing to Filing GST Returns
GST data is generated from return invoices. The evaluator must charge the registration of the relevant purchase and sale and any other necessary information, such as the prepayments that automatically generate the declarations.
There is a window for a reconciliation of the invoices presented and the evaluator can work with its vendors for publication without being equal that the final execution will be prepared and will have to register the fiscal responsibility.
Preparing Business for GST Compliance
Transactions of 100% recorded in the system and reported sales of 100% of the registration system to make sure you prepare your business by.
Return all of the GST enabled technology solutions since the event occurs within the IT infrastructure than to adopt technological solutions faculty will have no alternative. Without efficient solution products, companies recommend a compatible.
You need to be a GST transaction is 100% and will not be used to analyze the recording. Technical solutions such as failure to adapt to improve working capital, including the seller and the agony of customers could have a negative effect Company.
GST News Latest
27 February 2020:
➡ Lotteries to attract 28% tax from March 1 — Read More
January 23, 2019:
➡ National Bench of Goods and Services Tax Appellate Tribunal formed in India – Read more
January 1, 2019:
➡ New GST Revised rates, to be applicable from January 1, 2019 – Read More
This post was last modified on February 27, 2020 11:51 AM