Finally, within few hours, the biggest tax reform, since independence i.e. GST after crossing all the setbacks, COMING INTO PICTURE. In a short span of time, GST became the talk of the nation. The waves of GST are all around the corner. What actually will happen, How will happen, these questions are continuously running in every head. We are left with hardly few hours to get all our answers. Yes, the wait is about to over, tonight is the official launch of the goods and services tax (GST) i.e. mid-night of 30 June and 1 July. So, get ready with the biggest Tax reform, with the following main aspects of GST.
Till not we discussed much about GST related topic. In this write- up, only the overview of GST is being covered.
Intra- State Supply—CGST+SGST
Inter- State Supply—IGST
|Conditions||Trigger limit (In Rs)|
|For North Eastern States||10 lakhs|
|For Rest of India||20 lakhs|
Persons not required to be registered
|Sr. No.||Form Number||Description|
|1.||GST REG-01||Application for Registration (Other than a non-resident taxable person, a person supplying online information and data base access or retrieval services from a place outside India to a non-taxable online recipient referred to in section 14 of the Integrated Goods and Services Tax Act, a person required to deduct tax at source under section 51 and a person required to collect tax at source under section 52))|
|3.||GST REG-03||Notice for Seeking Additional Information / Clarification / Documents relating to Application for < Registration/Amendment/Cancellation>|
|4.||GST REG-04||Clarification/additional information/document for|
|5.||GST REG-05||Order of Rejection of Application for|
|6.||GST REG-06||Registration Certificat|
|7.||GST REG-07||Application for Registration as Tax Deductor at source (u/s 51) or Tax Collector at source (u/s 52)|
|8.||GST REG -08||Order of Cancellation of Registration as Tax Deductor at source or Tax Collector at source|
|9.||GST REG-09||Application for Registration of Non Resident Taxable Person|
|10.||GST REG 10||Application for registration of 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|
|11.||GST REG-11||Application for extension of registration period by casual / non-resident taxable person|
|12.||GST REG-12||Order of Grant of Temporary Registration/ Suo Moto Registration|
|13.||GST REG-13||Application/Form for grant of Unique Identity Number (UIN) to UN Bodies/ Embassies /others|
|14.||GST REG-14||Application for Amendment in Registration Particulars (For all types of registered persons)|
|15.||GST REG-15||Order of Amendment|
|16.||GST REG-16||Application for Cancellation of Registration|
|17.||GST REG-17||Show Cause Notice for Cancellation of Registration|
|18.||GST REG-18||Reply to the Show Cause Notice issued for Cancellation|
|19.||GST REG-19||Order for Cancellation of Registration|
|20.||GST REG-20||Order for dropping the proceedings for cancellation of registration|
|21.||GST REG-21||Application for Revocation of Cancellation of Registration|
|22.||GST REG-22||Order for revocation of cancellation of registration|
|23.||GST REG-23||Show Cause Notice for rejection of application for revocation of cancellation of registration|
|24.||GST REG-24||Reply to the notice for rejection of application for revocation of cancellation of registration|
|25.||GST REG-25||Certificate of Provisional Registration|
|26.||GST REG-26||Application for Enrolment of Existing Taxpayer|
|27.||GST REG-27||Show Cause Notice for cancellation of provisional registration|
|28.||GST REG-28||Order of cancellation of provisional registration|
|29.||GST REG-29||Application for cancellation of provisional registration|
|30.||GST REG-30||Form for Field Visit Report|
A registered person supplying taxable goods shall, before or at the time of,—
(a) removal of goods for supply to the recipient, where the supply involves movement of goods; or
(b) delivery of goods or making available thereof to the recipient, in any other case,
issue a tax invoice showing the description, quantity and value of goods, the tax charged thereon and the particulars prescribed in relevant rule.
Time limit for issuing tax invoice
The invoice in case of taxable supply of services, shall be issued within a period of thirty days from the date of supply of service.
Provided that where the supplier of services is an insurer or a banking company or a financial institution, including a non-banking financial company, the period within which the invoice or any document in lieu thereof is to be issued shall be forty five days from the date of supply of service.
BILL OF SUPPLY
A registered person supplying exempted goods or services or both or paying tax under composition scheme, instead of a tax invoice, a bill of supply containing such particulars and in such manner as prescribed in relevant rules.
A registered person may not issue a bill of supply if the value of the goods or services or both supplied is less than two hundred rupees subject to such conditions and in such manner as prescribed in relevant rules.
A registered person shall, on receipt of advance payment with respect to any supply of goods or services or both, issue a receipt voucher or any other document, containing such particulars as prescribed in relevant rules, evidencing receipt of such payment.
Where, on receipt of advance payment with respect to any supply of goods or services or both the registered person issues a receipt voucher, but subsequently no supply is made and no tax invoice is issued in pursuance thereof, the said registered person may issue to the person who had made the payment, a refund voucher against such payment.
CREDIT & DEBIT NOTE
Where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient a credit note containing such particulars as prescribed in relevant rule.
Where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goods or services or both, shall issue to the recipient a debit note containing such particulars as prescribed in relevant rules.
A registered person, whose aggregate turnover in the preceding financial year did not exceed seventy five lakh* rupees, may opt to pay, in lieu of the tax payable by him.
*For special Category States, the threshold limit is fifty lakh rupees, except Uttarakhand.
Rate of tax of the composition levy
|Category of registered persons||Rate of tax|
|Manufacturers, other than manufacturers of such goods as may be notified by the Government||one per cent|
|Suppliers making supplies referred to in clause (b) of paragraph 6 of Schedule II||two and a half per cent|
|Any other supplier eligible for composition levy under section 10 and the provisions of this Chapter||half per cent|
Non availability for Input Tax Credit
The person opting for Composition scheme is not eligible to take Input Tax Credit.
No need to file fresh intimation every year
The registered person paying tax under composition scheme may not file a fresh intimation every year and he may continue to pay tax under the said section subject to the provisions of the Act and these rules.
List of composition formats
|Sr. No.||Form No.||Description|
|1||GST CMP-01||Intimation to pay tax under section 10 (composition levy) (Only for persons registered under the existing law migrating on the appointed day)|
|2||GST CMP-02||Intimation to pay tax under section 10 (composition levy) (For persons registered under the Act)|
|3||GST CMP-03||Intimation of details of stock on date of opting for composition levy (Only for persons registered under the existing law migrating on the appointed day)|
|4||GST CMP-04||Intimation/Application for withdrawal from composition Levy|
|5||GST CMP-05||Notice for denial of option to pay tax under section 10|
|6||GST CMP-06||Reply to the notice to show cause|
|7||GST CMP-07||Order for acceptance / rejection of reply to show cause notice|
ACCOUNTS & RECORDS
Maintenance of accounts by registered persons
Every registered person shall keep and maintain, at his principal place of business, as mentioned in the certificate of registration, a true and correct account of—
(a) production or manufacture of goods;
(b) inward and outward supply of goods or services or both;
(c) stock of goods;
(d) input tax credit availed;
(e) output tax payable and paid; and
(f) such other particulars as may prescribed in relevant rules.
|Type of Return||Time Period of filling of Return||Return|
|Outward Return||10th of next month||GSTR-1|
|TDS Return||10th of next month||GSTR-7|
|Return by Input Service Distributor||13th of next month||GSTR-6|
|Inward Return||15th of next month||GSTR-2|
|Return by Composition Supplier||18th day from the end of quarter||GSTR-4|
|Monthly return||20th of next month||GSTR-3|
|Annual Return||31st December of next year||GSTR-9|
|Periodic return by non-resident foreign taxpayer||20th Day of next month or with 7 days of Last day of registration||GSTR-5|
But for the first two months right after the roll out of GST, the rate would be:
|Name of the Person||Actual Date||Extended Date for the 1st two months|
|Outward Supplier (for the month of July)||10th August||5th September|
|Outward Supplier (for the month of August)||10th September||20th September|
|Inward Supplier Supplier (for the month of July)||15th August||10th September|
|Inward Supplier (for the month of August)||15th September||25th September|
E- Commerce (TCS)
In a layman term, e- commerce is defined as the use of electronic transmission medium (tele-communication) to engage in the exchange, including buying and selling of products and services requiring transportation either physically or digitally from location to location.
Important points under E- commerce:
SET OFF PROVISIONS WITH RESPECT TO ITC
The amount of input tax credit available in the electronic credit ledger of the registered person on account of-
(a) integrated tax shall first be utilised towards payment of integrated tax and the amount remaining, if any, may be utilised towards the payment of central tax and State tax, or as the case may be, Union territory tax, in that order;
(b) the central tax shall first be utilised towards payment of central tax and the amount remaining, if any, may be utilised towards the payment of integrated tax;
(c) the State tax shall first be utilised towards payment of State tax and the amount remaining, if any, may be utilised towards payment of integrated tax;
(d) the Union territory tax shall first be utilised towards payment of Union territory tax and the amount remaining, if any, may be utilised towards payment of integrated tax;
(e) the central tax shall not be utilised towards payment of State tax or Union territory tax; and (f) the State tax or Union territory tax shall not be utilised towards payment of central tax.
“Reverse Charge” means the liability to pay tax by the recipient of supply of goods or services or both instead of the supplier of such goods or services or both.
Services under Reverse Charge
|Sl. No.||Service||Provider of service (Percentage of service tax payable by service provider is NIL)||Recipient of Service||Percentage of service tax payable by any person other than the service provider|
|1.||Taxable services provided or agreed to be provided by any person who is located in a non-taxable territory and received by any person located in the taxable territory other than non-assessee online recipient (OIDAR)||Any person who is located in a nontaxable territory||Any person located in the taxable territory other than non-assessee online recipient (Business Recipient)||100%|
|2.||Services provided or agreed to be provided by a goods transport agency (GTA) in respect of transportation of goods by road||Goods Transport Agency (GTA)||(a) any factory registered under or governed by the Factories Act, 1948;
(b)any society registered under the Societies Registration Act, 1860 or under any other law for the time being in force in any part of India;
(c) any co-operative society established by or under any law;
(d)any person registered under CGST/SGST/UTGST Act; (e) any body corporate established, by or under any law; or
(f) any partnership firm whether registered or not under any law including association of persons.
(g) Casual taxable person
|3.||Services provided or agreed to be provided by an individual advocate or firm of advocates by way of legal services, directly or indirectly||An individual advocate or firm of advocates||Any business entity.|
|4.||Services provided or agreed to be provided by an arbitral tribunal||An arbitral tribunal||Any business entity.|
|5.||Sponsorship services||Any person||Anybody corporate or partnership firm|
|6.||Services provided or agreed to be provided by Government or local authority excluding, – (1) renting of immovable property, and (2) services specified below-
(i) services by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services provided to a person other than Government;
(ii) services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport;
(iii) transport of goods or passengers
|Government or local authority||Any business entity.|
|7.||Services provided or agreed to be provided by a director of a company or a body corporate to the said company or the body corporate;||A director of a company or a body corporate||A company or a body corporate.|
|8.||Services provided or agreed to be provided by an insurance agent to any person carrying on insurance business||An insurance agent||Any person carrying on insurance business.|
|9.||Services provided or agreed to be provided by a recovery agent to a banking company or a financial institution or a non-banking financial company||A recovery agent||A banking company or a financial institution or a non-banking financial company.|
|10.||Services by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India||A person located in non-taxable territory to a person located in non-taxable territory||Importer as defined under clause (26) of section 2 of the Customs Act, 1962.|
|11.||Transfer or permitting the use or enjoyment of a copyright covered under clause (a) of sub-section (1) of section 13 of the Copyright Act, 1957 relating to original literary, dramatic, musical or artistic works||Author or music composer, photographer, artist, etc.||Publisher, Music company, Producer|
|12.||Radio taxi or Passenger Transport Services provided through electronic commerce operator||Taxi driver or Rent a cab operator||Any person||100% by Electronic Commerce Operator|
INPUT TAX CREDIT
Conditions for availing ITC:
(a) he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as prescribed under relevant rules;
(b) he has received the goods and/ or services;
(c) the tax charged in respect of such supply has been actually paid to the appropriate Government, either in cash or through utilization of input tax credit admissible in respect of the said supply, and
(d) he has furnished the Returns under section 34.
Cases where ITC shall not be allowed
(a) Where the registered person has claimed depreciation on the tax component of the cost of capital goods and plant and machinery under the provisions of IT Act, 1961
(b) In respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier.
In my upcoming articles, Ifs and Buts about ITC will be discussed.
Hope this information will help you in your Professional endeavors. For further assistance/query, feel free to write to us.
Author: C S Ekta Maheshwari is the Author of this article and is Company Secretary by profession. The Author can be reached at firstname.lastname@example.org
Disclaimer: The entire contents of this article is solely for information purpose and have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation.. It doesn’t constitute professional advice or a formal recommendation. The author has undertook utmost care to disseminate the true and correct view and doesn’t accept liability for any errors or omissions. You are kindly requested to verify & confirm the updates from the genuine sources before acting on any of the information’s provided herein above.