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Composition scheme under the GST law is for small businesses where they can opt to pay a fixed percentage of turnover as tax in lieu of standard rate of tax and be relieved from the detailed compliance of the provisions of law. Section 10 of CGST Act deals with composition levy.
The importance of place of supply is to determine (i) Nature of Supply (ii) Type of Tax to be levied and (iii) Tax Collecting Jurisdiction Authority. Under the present indirect tax system, both Central and State Government levy the taxes goods. Further Central Government has exclusive authority to levy tax on services.
The laws and regulations for selling goods and services on online portals like Amazon, Flipkart, Snapdeal has undergone a lot of changes after GST implementation. Here in this article summarized reference of all the sections, rules & notifications of GST is being given:-
Entertainment is a big part of our daily lifestyle. Cable TV is the most easily available and play a vital role in our life . Under the Old Tax System indirect tax system like Entertainment Tax, VAT, CST are levied by state Govt, and the Tax rates ranges from 15% to 110%. Central Govt imposed Service Tax on big cable TV operators and broadcaster who’s annual turnover is more then 10Lac. The Tax on Local Cable Operators (LCOs) was introduced in erstwhile Service Tax laws. Service tax on Local Cable Operators (LCOs) is implemented on w.e.f. 24.02.2009. The service tax currently (pre-GST) is 15%. The Goods and Services Tax (GST) would be a very significant step in the field of indirect tax reforms in India. By amalgamating a number of Central and State taxes into a single tax (GST). Now, GST implemented on 1st July 2017. Taxation on entertainment, cable and DTH services shall come down under the Goods and Services Tax regime as the entertainment tax levied by states has been subsumed in the GST. 18% GST is imposed on cable tv operators. The taxable supplies by LCO under the cable TV industry is liable of taxable 18% GST. Definition and scope of service: “Cable Operator” shall have the meaning assigned to it in clause (aa) of Section 2 of the Cable Television Networks (Regulation) Act, 1995 (7 of 1995); (Section 65(21) of the Finance Act, 1944) “Taxable Service” means any service provided or to be provided to any person, to any person, by a cable operator including a multisystem operator in relation to cable services; (Section 65 (105) (zs) of the Finance Act, 1994). Local Cable Operator (LOC) required to get registered? All the Existing Taxable Person, already registered under state govt Entertainment Tax are compulsory migrated to GST. Section 24 of CGST Act, 2017 explains Compulsory registration in certain cases If a person supplies taxable supply of goods/services 1. Inter-State Suppliers 2. Casual Taxable Person 3. Reverse Charge 4. Non-Resident Taxable Person 5. TDS deductor u/s 37 6. Agents 7. Input Service Distributor 8. Every Electronic Commerce Operator 9. Aggregator 10. Such other person as may be notified by Central/State Government on the recommendations of the GST Council. GST on Local Cable Operators LCO’s Taxable Supplies : 1. Taxable Sale/Service (Outward supply) by LCO’s: (a) Supply of Cable TV package to end user (customers) (b) Supply of Set-top box (STB) and Installation Charges (c) Repair of STB (d) Supply of Broadband package (e) Other related supply made for the provision of Cable TV / Broadband package (a) Supply of Cable TV package to end user (customers) : Cable broadcasting service is Taxable Supplies under GST, 18% GST will be charged depending upon the location of recipient of services i.e. Customer. Local Cable Operator makes a supply of Cable TV to an individual un-registered subscriber ie customer. Since the supply is made to an un-registered person, the LCO will issue a taxable invoice to subscriber. If the individual is a registered person, then the LCO will issue a taxable invoice to the subscriber. On the basis of taxable invoice, individual will claim the credit of GST. (b) Supply of Set-top box (STB) and Installation Charges : STBs are generally supplied to customers on activation basis. Customer activate STBs in his name on payment of activation charges from LOC. GST will be paid @ 18% on activation revenue collected by LCO from end-customers. MSO will also charge GST @ 18% on the STB activation charges from LCOs. LCOs will take the ITC credit of GST paid on the activation charges. Ownership of STB will always lie with the MSO since the box is not sold to LCOs. LCOs cannot sell the STB to the customer. They can provide the same on activation only. (c) Repair of STB STB repair charges collected from customers. If STB repair charges are paid to registered vendor/person, LCO will claim the GST @18% Input tax credit on the invoice issued by the vendor. If the STB repair charges are paid to unregistered vendor/person, LCOs will be liable to pay GST under reverse charge mechanism. LCO has to pay GST under Reverse charge and the same will be available as Input tax credit (ITC). (d) Supply of Broadband package or Other related supply made for the provision of Cable TV / Broadband package Supply of Broadband Services to the end user, LCO also acts as authorised Broadband agents for the internet service provider (ISP) company. The ISP may be an existing MSO, for whom the LCO is already working or may be a different ISP company. LCO collects and remits the amount collected from end user customers to Broadband services to the ISP company. LCO will claim the GST @18% Input tax credit on the invoice issued by ISP company/MSO. 2. Taxable purchases (Inward Supply) by the LCO’s: (a) Channels subscription Fee by MSO (b) STB Purchase from Vendors (c) STB activation charges paid to MSO (d) STB repair charges paid to Vendor (e) Cable Network items Purchase from Vendors (f) Office Rent Local Cable Operators LCO’s purchase/received Inward Taxable Supply from various Suppliers under GST also get input tax credit on purchase/inward supplies/channels subscription fee paid by LCO. Availability of ITC for Local Cable Operators on purchase/received Inward Taxable Supply from various Suppliers/vendors. ITC for Local Cable Operators will now be available on the purchase /Service received (Inward Taxable Supply) like Channels subscription Fee by MSO, STB Purchase from Vendors, STB activation charges paid to MSO, STB repair charges paid to Vendor, Cable Network items components Purchase from Vendors and Office Rent paid to the owner of the premise. Which were not available under the pre-GST regime. So, the input GST paid when renting a premise can be adjusted with the output GST from selling cable tv broadcasting service by local cable operator. In this case Local cable operator needs to be registered with GSTN, because he is working as an agent of other taxable person i.e. Broadcasting/Broadband Company. Local Cable Operators LCO’s have to Register for GST even if their total taxable revenue is less than the Rs 20lakh/ Rs 10lakh threshold limit. Local cable operator (LCOs) are selling the cable TV entertainment packages to the end users ie Customers. End users/Customers can only be viewed the channels/Cable TV with the help of Set Top Box (STB) through the supply of signal by cable network, This network is controlled, managed and serviced by Local cable operator (LOC), and this cable network is directly owned, controlled and provided by the MSO. This is taxable under Section 24, Clause (vii) of CGST Act, 2017, Compulsory registration in certain cases. Every Local cable operator LCO has to register under GST. Even if the LCO is managing only one Cable TV connection, he is liable to get registered under GST. LCO is taxable under Section 24, Clause (vii) of CGST Act, 2017, Compulsory registration in certain cases. Section 24 of CGST Act, 2017 explains Compulsory registration in certain cases as follows : The extract of Section 24 of CGST Act,2017 quoted below 24. Notwithstanding anything contained in sub-section (1) of section 22, the following categories of persons shall be required to be registered under this Act – (i) persons making any inter-State taxable supply; (ii) Compulsory registration in certain cases Section 24 of CGST Act, 2017(ii) casual taxable persons making taxable supply; (iii) persons who are required to pay tax under reverse charge; (iv) person who are required to pay tax under sub-section (5) of section 9; (v) non-resident taxable persons making taxable supply; (vi) persons who are required to deduct tax under section 51, whether or not separately registered under this Act; (vii) persons who make taxable supply of goods or services or both on behalf of other taxable persons whether as an agent or otherwise; (viii) Input Service Distributor, whether or not separately registered under this Act; (ix) persons who supply goods or services or both, other than supplies specified under sub-section (5) of section 9, through such electronic commerce operator who is required to collect tax at source under section 52; (x) every electronic commerce operator; (xi) every person supplying online information and data base access or retrieval services from a place outside India to a person in India, other than a registered person; and (xii) such other person or class of persons as may be notified by the Government on the recommendations of the Council. The above information clarifies about Compulsory registration in certain cases under section 24 of CGST Act,2017. Conclusion : Every Local cable operator LCO has to register under GST. Even if the LCO is managing only one Cable TV connection, he is liable to get registered under GST and paid the GST @18% collected from end user ie customer. LCO is taxable under Section 24, Clause (vii) of CGST Act, 2017, Compulsory registration in certain cases. As per Section 24, Clause (vii) of CGST Act, 2017 persons who make taxable supply of goods or services or both on behalf of other taxable persons whether as an agent or otherwise. Author Details : Ashish kamthania, Advocate, BSc, BEd, PGDCA, LL.B., LL.M. Director: Tax & Legal Professional Private Limited Contact at : GstGuruJi@gmail.com https://www.facebook.com/kamthania
The transaction with related persons has been a special area of consideration for government and tax authorities on the assumption that the transaction may be motivated by something more than earning the profit. GST has introduced certain provisions that will affect the related party transaction of the business owner.
Central Government hereby specifies the persons making inter-State taxable supplies of handicraft goods as the category of persons exempted from obtaining registration under the aforesaid Act.
Central Government hereby specifies the job workers engaged in making inter-State supply of services to a registered person as the category of persons exempted from obtaining registration under the said Act:
This excel sheet has been updated with functionality for carry forward of ITC . Many People are getting confused over treatment of RCM in the Excel Sheet. RCM in Simple terms means to Pay tax and claim the input in the same month this is bifurcated in two groups. Expenses/Purchase From a Unregistered dealers. These […]
Delhi High Court on appeal by Narendra Plastic Private Limited directed as under: (i) The Petitioner will be permitted to clear the consignments of imports constituting inputs for the fulfilment of its export orders placed on it prior to 1st July 2017 without any additional levies, and subject to the quantity and value as specified […]
A lot of confusion is in each of us mind that When we need Registration, When COMPULSORY Registration required & When we are exempt from Registration ?
