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  • GST Registration

    The GST (Goods and Service Tax) Bill was approved by Narendra Modi, the Prime Minister of India, in an effort to replace all state or central government-imposed indirect taxes. As a result, it is now compulsory for entities engaging in the supply of goods and services across states to do GST registration online.

    The GST bill was recently passed by the Lok Sabha on March 30th and it is going to directly affect everyone in the country. So, what is GST? GST stands for Goods and Services Tax. It will be imposed by the state and central governments and will be subsume most of the indirect taxes such as VAT, Service Tax, etc.

    Anyone who has a valid PAN, is registered under the current Income Tax Law and crosses the turnover GST limit can register for GST. People who have to pay TDS, casual traders, etc., have to register for GST. Existing assesses have to get their provisional ID and password for GST portal from their state’s ACES or VAT website. After they login on to the GST portal, they will have to create a new user ID and password.

    Mandatory GST Registration Online

    All businesses whose turnover is above Rs.20 lakh, or Rs.10 lakh (for North-Eastern states), are expected to do GST registration as a regular taxable person. GST online registration is also mandatory for NRI taxable individuals, entities engaging in e-commerce, entities supplying goods and services via e-commerce operators, individuals who are eligible for TDS (Tax deducted at source), entities engaging in the provision of online information or retrieval services or database access, etc.

    Most entities and businesses in the country are required to complete GST registration online. Even entities that are not mandated to complete GST online registration can do so on a voluntary basis as registration enables the entity to gain legal recognition as a supplier of goods and/or services, thereby allowing the entity to levy GST on customers who avail their goods or services. As such, entities that have completed GST registration online can be eligible to avail input tax credit.

    How to do GST Online Registration

    Here is a Step-by-Step Procedure to Complete GST Online Registration

    • Log on to www.gst.gov.in.
    • Click on the ‘Services’ tab on the menu at the top of the page.
    • You will have three options, viz. ‘Registration’, ‘Payments, and ‘User Services’.
    • Click on ‘Registration’ and select ‘New Registration’.
    • You will be redirected to a new page wherein you will have to select whether you are a taxpayer or a GST practitioner before entering a few details such as the legal name of the business, the state and district in which the entity is located, Permanent Account Number, email address and mobile number. This is basically Part-A of the form.
    • The details you have entered will have to be verified by the portal, so you will receive a one-time password or an email for confirmation.
    • Based on the kind of business you are running, you will be required to upload a few documents as requested.
    • Part-B of the form will then have to be filled in with a few details after which you will receive the Application Reference Number through email or SMS.
    • Your application will then be verified by a GST officer and it could either be approved or you will be requested to provide some more details or documents until the authorities have all the required information to approve your application.

    Separate registration has to be done for each state, if a trader has branches in multiple states. Businesses with more than 1 vertical can register separately for each of them.

    As GST has just been introduced, it may take us a while to get used to it and understand it. At present, all assessees have been asked to register for GST and not procedure is in place for people who do not want to register for it. They can choose to cancel their registration after registering though.

    Penalties for not Completing GST Online Registration

    Offenders who do not pay tax or fail to make the full payment will face a penalty of 10% of the tax amount. The minimum amount of fine will be Rs.10, 000 if the 10% amounts to anything less. In case of deliberate tax evasions, offenders will be charged a penalty of 100% of the tax amount. The penalty will be 10% of the tax due in case of genuine errors.

    News About GST Registration

    • Rationalisation of GST rate possible, says the Finance Minister

      The Minister of Finance Piyush Goyal recently said that the Goods and Services Tax (GST) Council are looking for possibilities to rationalise the rates of tax on a number of items. However, he added that it will be effective only after ensuring the balance with revenue mop-up. Goyal also said that the council will be discussing the ease of filing returns along with the ease of assessment in their next meeting. He said that the GST Council has already reduced the rates on 328 items which might lead to the further possibility of a reduction in rates on certain items. However, they have to be in balance with the revenue considerations.

      On being asked if the GST Council will consider lowering the rates in the next council meeting, the Minister of Finance said that the council had been very responsive to the demands of the industry from the inception of the Goods and Services Tax (GST). Wherever there were cases of inverted duty or any other issue that required attention, the council had reduced the rates accordingly to ensure the ease of doing business. At present, there are 4 slabs under the Goods and Services Tax (GST) regime: 5%, 12%, 18%, and 28%.

      Since the rollout of GST on 1 July last year, the new indirect tax system has subsumed over a dozen local levies and helped to transform the nation into a single market with the seamless flow of goods.

      8 August 2018

    • Single GST rate slab is a ridiculous suggestion: Finance Minister

      The Union Finance Minister Piyush Goyal recently said that the proposal put forward by some of the political parties for a single GST rate slab was a “ridiculous suggestion”. Some of the political parties have been constantly placing the proposal for the four-slab Goods and Services Tax (GST) rate structure to be abolished. They have proposed the introduction of a single slab tax structure instead and Congress has also promised that the rates will be reduced to just one slab if they are voted to power in the 2019 general elections. In this context, the Union Finance Minister said that implementing one rate of tax slab will not be a prudent move. He indicated that the main burden, in this case, will fall over the people belonging to the middle class as well as the poor as items of daily use such as salt, sugar, and clothes will be coming under the 18% GST slab.

      Goyal said that the past Congress-led UPA government has proposed an 18% single GST slab looking at the tax collections and concessions given to the poor. He added that the rate proposed earlier would not have been accepted and the GST structure would not have worked. After the rollout of the Goods and Services Tax (GST) last year, the rates have been reduced for 328 items out of the 1,200 items that have been included under the ambit of the newly implemented indirect tax.

      26 July 2018

    • GST Council to discuss annual return form on 21 July

      The Goods and Services Tax (GST) Council is likely to approve the format for annual returns and audit in its meeting which is to be held on 21 July 2018. As the government plans to check tax evasion, the industry is expecting some reconciliation with annual income tax returns. 2017-18 is the first year when businesses will be required to file their annual returns (GSTR-9) under the GST regime. This has to be done by the end of the year, i.e. 31 December 2018. Businesses with a turnover of more than Rs.2 crore will be required to file audit reports in addition to the annual returns.

      A draft has been prepared by the revenue officers for the Goods and Services Tax (GST) annual return form. This form will be taken up for discussion at the GST Council meeting on 21 July 2018. Once the form is taken up, the IT backbone of the Goods and Services Tax (GST), GST Network (GSTN) will finalise the software which will enable the firms to file their annual returns. Tax experts are expecting that the GST annual return form will be in line with the prior indirect tax regime, Value Added Tax (VAT) regime. They are expecting the presence of certain columns on the form for reconciliation with ITR and audit report. The expected date of the availability of the forms according to the experts is by the end of October this year, so that the annual returns are filed by the end of the year, i.e. 31 December 2018.

      20 July 2018

    • Top IT companies have over $2 billion in tax disputes

      Leading IT companies like Tata Consultancy Services (TCS), Infosys, Cognizant, and Wipro have more than $2 billion in tax disputes pending in India. The main reason behind the disputes is the differences in the calculation of incentives for export-oriented units and distribution of dividend taxes to investors. Reportedly, Infosys and Wipro are fighting cases related to tax incentives that they have claimed under the Software Technology Parks of India (STPI) and Special Economic Zone (SEZ) schemes. On the other hand, Cognizant is in a dispute over how the dividend distribution tax over profits repatriated to its parent company is calculated.

      Tata Consultancy Services (TCS) has over Rs.5,600 crore in disputes pending with the tax authorities. In the financial year 2017, TCS reported Rs.2,690 crore in contingent liability related to tax disputes. The company disclosed in their latest annual report that the liability has almost doubled since the previous financial year. The senior vice president of IT industry body Nasscom, Sangeeta Gupta said, “Many of these disputes are because of issues with interpretation by different tax officials.” She added that a number of these cases eventually land up in courts and are dragged on for years.

      11 July 2018

    • Government to include natural gas, jet fuel under GST in next Council meeting on July 21

      Reportedly the government has no plans to include petrol and diesel under the GST ambit immediately. The GST Council has a meeting on 21 July 2018 where the council might give a nod to the inclusion of ‘natural gas’ and ‘aviation turbine fuel’ under the new indirect tax regime. The Finance Secretary Hasmukh Adhia confirmed to the PTI that the decision in regards to the inclusion of these 2 items under the GST regime will be decided in the next meeting. The main reason behind the government agreeing to the inclusion of natural gas and aviation turbine under GST is the low tax incidence on them. It is a safe bet for the government as the inclusion can be accommodated in the five-slab tax system easily.

      Since the rollout of GST on 1 July 2017, several items have been added to the GST net. This has led to the reduction of prices of items and at the same time, it has widened the indirect tax system in the nation. It has helped to formalise the economy and removed middlemen.

      3 July 2018

    • Centralised AAR for taxpayers with 5 or more registration

      The verdicts from the Authority for Advance Rulings (AAR) have been contradictory and thus, they are creating a confusion among taxpayers. In order to curtail the confusion, the government is likely to constitute a centralised AAR for taxpayers who have five or more registrations. The amendment in the law pertaining to this issue is likely to be announced by the GST Council meeting on 2 July 2018.

      This decision came after the recent announcements made by the AARs in different states created a confusion among the taxpayers as well as the tax experts. In some cases the rulings pronounced by the Central Board of Indirect Taxes and Customs (CBIC) have contradicted, while in other cases AARs in two different states have given two contradicting rulings on the same issue.

      2 July 2018

    • Finance Minister Arun Jaitley Hails April GST Collections as ‘Landmark Achievement’

      Arun Jaitley, the Finance Minister of India, tweeted about the GST revenue collections for the month of April, 2018, saying that it was a ‘landmark achievement’. GST collections for the month crossed the Rs.1 lakh crore mark for the first time since the implementation of the new regime. Up until now, GST collections amounted to about Rs.88,000 lakh. Mr Jaitley stated that thanks to the improvement in economic climate in addition to the implementation of the GST e-way bill along with enhanced GST compliance, collections are expected to maintain a positive trend. He also congratulated the Central and State Government tax administration along with members of the GST Council for the achievement.

      16 May 2018

    • Small Taxpayers to Have Simpler Compliance Norms Under GST

      Some of the main features of GST’s return mechanism includes the e-filing of returns, auto-populating details regarding input tax credit, and uploading invoice level details among others. The mechanism was created to help taxpayers in filing their returns as well as availing input tax credit. Under the Goods and Services Tax, common taxpayers are mandated to submit their returns on a monthly basis in addition to an annual return. However, the GST Council has recommended the simplification of compliance requirements, at least for small taxpayers. Those whose yearly aggregate turnover is under Rs.1.5 crore will have to file Form GSTR-1 every quarter, while those whose yearly aggregate turnover exceeds Rs.1.5 crore will have to file the form every month.

      25 April 2018

    • GST Registration Not Required for Inter-State Supplies to the Extent of Rs.20 Lakh

      Small service providers primarily offer inter-state services, but once in a while get small amounts from their clients in other states. The aggregate value of the services they offer on a country-wide basis is seldom above the threshold limit. The GST Council has taken a decision to ensure that service providers are allowed to engage in inter-state supplies to the extent of Rs.20 lakh without having to register under the new regime. These service providers can also buy commodities by paying GST and exporting the commodities either without payment of Integrated Goods and Services Tax.

      17 October 2017

    • How CGST, SGST, and IGST differ from each other

      Under GST, there are three main types of taxes:

      • Central GST (CGST)
      • State GST (SGST)
      • Integrated GST (IGST)

      In order to identify the tax that will be levied at a specific taxable event, you need to be aware of what intra-state transaction and inter-state transaction are.

      Inter-state transaction - If the supplier is located at a different place/state to where the goods/services are supplied, then it is referred to as an inter-state supply.

      Intra-state transaction - If the supplier and the place of supply of goods/services are located in the same state, then the supply is referred to as an intra-state supply.

      On an inter-state supply, the Central Government charges IGST. On intra-state transactions, the Centre charges CGST and the State charges SGST.

      1. CGST - The Central Goods and Services Tax is levied on intra-state supply of goods/services, along with SGST. The Central and State Governments will decide on a proportion for revenue sharing on the imposition of CGST and SGST at a supply event. In no case will the rate of taxation exceed 14% each.
      2. SGST - The State Goods and Services Tax is, as mentioned above, levied on intra-state supply of goods/services. This tax money goes to the exchequer of the State Government.
      3. IGST - Integrated Goods and Services Tax is charged on inter-state transactions. This is also levied on export and import of goods/services. The proceeds from this taxation will go to the Central Government.

      22 August 2017

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