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Why Your Business Needs Complete Gst Billing Software?

Goods and Service Tax (GST) is a great revolution for businesses in India. GST system converted the complex indirect tax framework of India into an easy, feasible, and integrated one. Before the advent of GST, the taxation process was a little tiresome but it is easy to file taxes with GST. 

In the long run, this new tax reform will overflow the Indian economy with positive effects. But the problem is filing GST taxes takes a little bit more time. Moreover, it is important for business owners to make sure that they enter 100% accurate details. Thus, it may take a little bit more time and effort but to make it easy, you can use the GST billing software.

The GST billing software for business automates the process and thus it is easier to file the taxes. GST’s unified tax format throughout India is an onerous task, especially when all Indians are not on board with the GST related processes. Some of the small and medium-sized businesses aren’t aware of the benefits that this billing software has.

You will see in this article will provide you with the important reasons why you need the best GST billing software even if you have a small business.

Mandatory fields a GST invoice should have

Companies generally issue a tax invoice to charge the tax and pass on the input tax credit. You can easily create it using the Easy GST website. You can easily file all your GST returns with one click, as you enter all your bills and invoices here. The website will automatically submit them to GST Server.

  • A GST Invoice must have the following mandatory fields:
  • Invoice number and date
  • Shipping and billing address
  • Customer name
  • Place of supply
  • Customer and taxpayer’s GSTIN (if registered)
  • Item details i.e. description, quantity (number), unit (meter, kg etc.), total value
  • HSN code/ SAC code
  • Item details i.e. description, quantity (number), unit (meter, kg etc.), total value

Ease of Filing Data and Simple Invoicing Methods

Most businesses use simple accounting software for all their requirements. Thus, this makes it harder for them to file the data and then integrate it. They have to merge that with the online government portal of GST. But with the help of GST tax software, it’s easier to migrate data from the software to the online portal.

GST invoicing is a little complex. Different goods have different HSN codes and tax percentages and you must enter the right codes as well as calculate the right tax percentage. Hence using  Free GST Software in India will make it easier to invoice various goods without any hassle.

Manage the Documents as well as Follow the Rules of GST

There are various documents in the business, from filing taxes to warning notices to refunds. All these documents have become digital since the emergence of GST and online documentation is mandatory. GST Tax Software will store your documents with ease & will classify them based on their types & store them in various folders.

There are various rules of GST according to the government. From various HSN codes to different tax slabs there are so many minute details to take care of. Also, small and medium-sized businesses aren’t always able to afford an accountant and often are in a terrible state. Easy GST website will make it easier to fill your GSTR 1,2 & 3 and also support your composition scheme.

Data Security and Customization Facility

Data security is the most important thing in recent times. No matter where you store the data, there is a high chance of breaching. But you can overcome this situation with free GST software in India. This software will take care of the security threats and thus they provide amazing security for the users.

You need not worry about the data that you have stored in the software, as it’s safe there. Also, investing in software like this will surely yield you so many benefits.

Cost-Effective and Time-Saving

It is important for you to keep track of your invoices if you are running a business. But the software will make things manageable and will help in keeping the track of all the invoices. It calculates the tax separately for each and every invoice. And thus the best GST billing software makes entire invoice processing is pretty simple and easy.

It solves all finance-related problems, from invoicing to tax filing easy and a lot of your time will be saved.

Artificial Intelligence Will Make Everything Easier

A business entity of one state files thirty-seven tax returns in one single year. Although GST vanished the indirect taxation system, the entire GST taxation system itself is complex. It takes some time as well as effort to adapt to the system. If your company has branches pan India then your company should file a total of 1073 tax returns in a single financial year.

It is definitely not an easy process. So, the artificial intelligence of GST compliant billing software comes as a saviour here. And makes it easy for your businesses to file taxes.

Customization

The customization feature of the GST billing software adds eggs to one’s beer. The software can be customized as per the demands and needs of your business. The artificially intelligent GST software is capable enough to address various types of tax penalties. Another advantage of this software is that it is highly flexible and can easily combine with various other software as well.

Key features to look for in a GST billing software for business

Here are some important features or details you should look for in the software that would ultimately benefit your business units.

  • A security feature that will protect confidential business information and that is robust in both tax filing and data security features.
  • Invoicing, Accounting and GSTN validator.
  • User-Friendly interface with step by step process explained that allows to navigate back and forth (excel-like interface).

You must invest in GST compliant software, as it is always a profitable deal. It will make your process simple, quick and more productive.

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Quick Look of New GST Returns Update and Clarification

In order to simplify the compliance procedure further for GST-registered businesses, the 31st GST Council meeting proposed a new return system. It was absolute that a New Return System under GST would be introduced for taxpayers. This system is likely to be introduced on October 1st, 2020. This return will need to be filed on a monthly basis.

The Goods and Services Tax (GST), was introduced as a single, straightforward tax system to replace multiple indirect taxes.

Under the new system, there will be three main return forms – Normal (RET-1), Sahaj (RET-2) and Sugam (RET-3). The type of return to be filed and the filing frequency is determined based on the turnover of a business.

Annexures of Main Returns

All three return forms will have two annexures GST ANX-1 & GST ANX-2.

GST ANX-1 is used for reporting outward supplies, inward supplies that are subject to reverse charge, and imports of goods and services. The merchant can upload related documents on a real-time basis in GST ANX-1.

GST ANX-2 will have details related to all the inward deliveries received from a registered supplier including imports and supplies received from an SEZ unit. Some of the details uploaded by the supplier in ANX-1 will be automatically available for the recipients in ANX-2 to verify and accept, reject or keep it pending.

Important changes introduced in the new GST return system

These are some of the changes introduced in the new return system-

  • HSN code will be needed in order to submit details at a document level vs. a separate HSN summary.
  • A user will also get HSN code to his GST ANX-2, wherever a supplier was supposed to declare the HSN code.
  • B2B supplies, liable to reverse charge mechanism need not be shown by the supplier in the GST ANX-1, however, the total figure will need to be shown in GST RET-1.
  • Inward supplies which are accountable to RCM has to be declared in GST ANX-1 at the GSTIN level, by the recipient of supplies.
  • The concept of B2C-L has been removed. The turnover limit for quarterly filers will be considered as Rs 5 crore of the present limit of Rs 1.5 crore.

Current System vs New Return System

Turnover limit for small business: Rs 1.5 crore for the previous financial year under current GST returns and Rs 5 crore under new GST returns.

Number of returns: Under the new system, there is a single return form (Normal/Sahaj/Sugam), containing two annexures.

Reporting of missing invoices: Missing invoices were reported using GSTR-3B in the current system. Missed invoices will be reported using RET-1 in the new system.

Reporting imports: In the current returns, ITC on imports was separately reported in GSTR-3B. However, ITC reports will be detailed under GST ANX-1 in the new returns system.

Need for cloud accounting

The new GST return has paved way for e-invoicing in India, where the taxpayers will now have to upload invoices in real-time. Since your accounting software will be connected with the government portal, it will allow you to retrieve invoices anytime to clarify the inconsistencies in your books.

With a new GST return system coming up, it is a good time for all businesses to switch to GST-compliant cloud accounting software. By adopting the Easy GST software and processes now, businesses can avoid penalties or other repercussions for non-compliance when the new return is implemented in October 2020.

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Everything You Must Know About UTGST?

The GST council has included the UTGST to fulfill the constitutional duty set out in Article 366 of the Constitution (One Hundred and First Amendment) Act, 2016, introducing a new provision, namely Provision 26B on “Government.” According to this section, with respect to Articles 246A, 268, 269, 269A, and 279A, “Land” includes a Union territory with a Legislature but also “Canada” for GST purposes, added a Union territory with a Legislature.

UTGST is imposed on transactions occurring in any union territory of India, including Andaman and Nicobar Islands, Dadra and Nagar Haveli, Chandigarh, Lakshadweep and Daman, and Diu, by the respective Union Territory. This tax in the rules of allocation and payment is identical to SGST.

The object of the UTGST bill is to apply, in the absence of a legislature, a tax collection on any Intra UT supply of goods and services in the union territories and has similar properties as SGST’s. All in all, therefore, the SGST can not fulfill the required requirement here and has taken its place for the same UTGST. The Union Territory GST applies to the territories of the Indian Union, including Chandigarh, Lakshadweep, Daman and Diu, Dadra and Nagar Haveli, Andaman and Nicobar.

Why Union Territory GST Is Implemented?

The key agenda was taken up by the GST council for which the UTGST was adopted by the apex body, which will continue to provide benefits the same as SGST. In addition, New Delhi and Puducherry will still enjoy the SGST rules, as both states have independent legislatures and are able to function openly under the terms of SGST, and the GST Council has also found them states.

For more comprehension on the subject of the Union Territory GST, one can see the legislative rules and regulations written into the constitution, that states that, pursuant to Article 246(4) of the Constitution, Parliamentary has the right to make laws on any matter for any part of the territory of India not included in the State, including the matters listed in the State List By checking the aforementioned constitutional rules and regulations, the central government will forward the UTGST for further approval to Parliament.

Under GST, all the states in India are protected by the SGST Act. In the Indian Constitution, the concept of ‘States’ includes union territories with their own legislature. Hence the SGST Act also refers to the Delhi and Puducherry union territories. This means that the taxes imposed on supplies within the Delhi and Puducherry union territories will be CGST+SGST, and the tax imposed on supplies from Delhi / Pondicherry to another State/union territory will be IGST.

Since the SGST Act cannot be applied in the territory of a union without its own legislature, the GST Council introduced the UTGST Act to impose a tax on the territories of the Chandigarh, Lakshadweep, Daman, and Diu, Dadra, and Nagar Haveli and Andaman and Nicobar Islands. UTGST will be levied in lieu of SGST in those union territories.

The explanation for the existence of UTGST is that the SGST for states cannot be enforced in Union Territories with no legislature. Because Delhi and Pondicherry have their own legislatures, they will collect and levy SGST in lieu of UTGST like other states.

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Benefits of Using the GST Software for Business You Must Know About

The term GST stands for taxation of goods and services. GST bill passed at Lok Sabha on 6 May 2015. If the bill has been introduced, it will give companies some big advantages. GST is basically a value-added tax that is collected at different intersections in the supply chain, providing credit for any tax charged on payment received for the use of supply. The middle-person or customer is, therefore, liable to pay the tax, which is the last in the supply chain. The introduction of the GST bill in India would simplify the indirect tax framework at the central and state rates. Until now, India has had a complex multi-layered taxation structure that will be replaced by GST.

In the current scenario, most company houses and organizations, whether large, small or medium, are in constant need of the best online accounting software that can do their accounts, Ledger, inventory, finance, measure the specific tax classification and also file them without any hustle. Through holding all of these criteria, the accounting software came onto the market that can perform all of these tasks effectively and can also measure GST to aid and sustain businesses.

Filing the data conveniently

Many companies settle for an accounting program that takes care of income, inventories, and different forms of taxation, invoices, and bills calculations. GST software has been implemented to make it easier to register and send complicated data by migrating your company to an online government portal. With GST, it becomes easier to measure the taxes, register, and send data.

Speed

Automated invoicing services make the accounting process run quicker and more effectively —- a big advantage. You can easily print professional-looking invoices, instead of using the old-fashioned manual paper and ink. Invoices can also be submitted via e-mail. The quicker invoices are coming out, the quicker you’ll possibly get billed. Most invoicing or billing software packages integrate with the rest of the accounting software, allowing the planning and recording of invoices easy, fast, and automatic.

Customizable Software

GST Program automates the taxes and other rates by the business method. The consumer is able to configure GST according to their business needs. Faults or defects in the produce, additional tax on goods, and other services can arise. The GST program is designed to resolve all tax penalties in a specific manner.

Organization

Invoices are easy to lose or forget, particularly when they are manually prepared. They may get lost in the mail, or they may misfile themselves in a manual system. With a kit of accounting software, the data is collected there — all in one place to be checked, repressed, and presented in case of problems. Typically, invoices based on names, amounts, or invoice numbers can be looked up in the system. It is one of the most reliable and fast and easy processes because as it is entered, the program organizes the data.

Minimize Errors

When using a computerized program, you make fewer errors in total calculation or typing, resulting in less uncertainty. The invoice program normally allows you to add a tax percentage where applicable, with all calculations being done by the device. This is a useful advantage, particularly if you have extensive invoices in which hours or particular products are charged at different rates. When a system is set up correctly, the products to be invoiced are chosen and arranged, and the rest is finished.

Time-Saving and Cost-Effective

Keeping track of all invoices and details about billing is crucial for any company. The use of GST tools can help control all payments and thus promote the filing of reports. This will save you both time and money, as GST software is responsible for all financial operations, from tax filing to invoicing.

Access Data Anywhere Anytime

All your documentation stored under one location, which can be easily accessed from everywhere, is the key benefit of GST software anytime. Testing and verifying data, keep track of your cash flow, and analyzing real-time payments are all available through GST software.

Implementing GST has the ability to raise the production rate for your company and export more goods without having to pay high tax charges. If you plan to expand your business, the implementation of GST will reduce the pain of repeated registration and filing of data. GST software’s key benefit over accounting software is the standardized tax structure applied without the boring task of estimating specific tax forms. GST software makes the program transparent and reduces the chance of tax evasion.

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Latest News and Updates About GST You Must Know About

The government must issue refunds to companies for products and services tax paid on orders that consumers have canceled due to the national shutdown placed to contain the latest coronavirus outbreak, as requested. It will benefit businesses who would be forced to refund all payments made to them, including vat.

According to Rajat Mohan, a partner at AMRG & Associates, companies used to change the excess GST charged for other new bookings, but now they will be liable for a refund, which will be a big relief. Hospitality and tourism, leisure, culture, media, advertisement, and aviation are some of the sectors that have been most impacted due to COVID-19 and that stand to benefit.

Upon the emergence of the Coronavirus epidemic, the global economy is forced to take a big step back. The Government of India has taken concrete steps to resolve the citizens’ and company concerns. Union finance and corporate affairs minister Smt on 24 March 2020. Nirmala Sitharaman announced significant relief steps on enforcement issues relating to laws and regulations across various sectors. Such announcements have focused in particular on the fields of Income Tax, EPF, ESI, GST, Customs & Central Excise, Corporate Affairs, Insolvency & Bankruptcy Code (IBC), Fisheries, and Banking and Trade.

A recent Rajasthan GST Advance Ruling on Goods and Service Tax Liability on Company Managers’ Remuneration has come up for discussion. The reasoning in this decision sets out a legal theory that relies on company law in terms of a director’s roles and responsibilities. Such interdependence on tax law definition isn’t unusual. In this case, the conflict was over the essence of the remuneration received by the director of a company and its taxability under GST.

It is expedient to mention those aspects of the GST law before diverting into the conflict. There is an absolute legislative exclusion from GST of compensation that an employee gets for their services. There is also a particular clause, albeit not under the GST law as such, but under a subordinate notice, which specifies that on the reverse charge basis, the GST responsibility for the services rendered by a director is with the recipient organization. Under the Service Tax Act, a similar clause prevailed.

GST Filing complications due to nationwide Lockdown

Regardless of the lockout and COVID-19 impact, all organizations and businesses are following up on work from home. Yet the modern trend of operating from home brings with it a few obstacles for start-ups and even for bigger corporations too. One of the problems that corporations face is that workers responsible for filing tax and GST returns and producing e-way bills can not access their office systems.

The GST reporting process is complicated as it includes consolidating cost bills and transactions from different agencies, validating and entering into accounting systems, calculating the amount of tax due from sales, and more. And, it usually occurs in the last week of the month, which in the current situation makes it impossible for a lot of businesses to handle and file their returns.

Small companies that are unable to operate from home, and where taxpayers are required to be on the premises to comply, are likely to be affected. Some employees can work at the premises for a short period of time for smooth product movement and e-way bill generation.

There are several companies that help their customers stick seamlessly to cloud-based applications that can be accessed anytime, anywhere. When data is applied, the program can automatically produce reports and create reconciliations. These are unique situations, and we hope that the government will be able to resolve those issues.

Latest GST Updates

  • GST returns filing date is being extended to 30 June 2020 for March, April & May by the government.
  • According to the government, there is no Late Fee, No Penalty for the businesses with a turnover of less than Rs.5 crore.
  • The last date for opting for composition scheme extended to 30 June 2020.
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Everything You Must Know About E-Invoice System under New GST Return and Benefits

On September 29, 2019, the GST Council approved the introduction of ‘ e-invoicing ‘ or ‘ electronic invoicing ‘ to report business-to-business (B2B) transactions to the GST system. From January 1, 2020, the new system will be introduced. Previously, there was no generic e-invoice model in India, but the latest GST return set a standard to meet the business needs of traders and industrial entities. E-invoicing is the submission on a common portal of a standard invoice that has already been produced. Thus, multi-purpose reporting is automated with a one-time input of invoice details.

What is E-Invoice?

If an invoice on the computer or Point of Sales (PoS) machine is generated by software, then does it become an e-invoice? Is e-invoice as a system that allows taxpayers to generate invoices centrally? When discussing e-invoice, many such questions are raised.E-invoice does not mean generating invoices from a tax department’s central portal, as any such centralization will result in unnecessary restrictions on the way in which trade is carried out. In fact, taxpayers have different requirements and expectations that cannot be met through one software that generates e-invoices from a portal for the entire country. Invoice generated by each software may look more or less the same, but another computer system cannot understand it even though business users fully understand it.

The key objective behind the E-Invoice System

The intention behind the e-invoicing problem is to reduce manual data entry errors. Since the machine regulates the e-invoicing system, the e-invoices of sellers, banks, agents, or anyone else involved in trading will be analyzed and read. As part of the Return, the e-invoice will also provide details to the GST system in addition to a seamless record of transactions.

Benefits of E-Invoicing

  • Invoice addresses and fills a significant gap in GST information reconciliation to minimize misalignment.
  • E-invoice resolves and mends a flaw in the GST data reconciliation process in order to reduce flaws.
  • Another software can read e-invoices created on one software, allowing interoperability and helping to reduce errors in data entry.
  • E-invoice addresses and mends a flaw in the GST information reconciliation process in order to reduce flaws.
  • Get real-time invoice tracking generated by the various suppliers with e-invoice.
  • As tax authorities receive all the necessary transaction-level information via e-invoices, audits/surveys must not be deterred.
  • Any program will read the e-invoices that were generated on one application, thereby allowing interoperability.
  • E-Invoice cannot be partially canceled; it has to be fully canceled.
  • E-Invoice has the option of canceling the invoice within 24 hours of IRP registration. Any cancellation after 24 hours could not be made via IRN; before filing the return, taxpayers must manually cancel the same on GST Portal.

The e-invoice mechanism is expected to be implemented on a voluntary basis in stages from 1 January 2020. It will be phased enforced.

How will E-invoicing curb tax evasion?

It will help in curbing tax evasion in the following ways:

  • Tax authorities will have access to transactions as they occur in real-time as the e-invoice must be generated compulsorily through the GST portal.
  • There will be less room for invoice manipulation as the invoice is created before a transaction is performed.
  • It will reduce the chances of fake GST invoices, and it is possible to claim the only genuine input tax credit as all invoices need to be created through the GST portal.
  • Since the input credit can suit output tax data, monitoring fake tax credit claims becomes easier for GSTN.
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Decisions and Amendments Made By Gst Council In 35th Meeting

Easy GST - Cloud Accounting Software Solution

On 21st June 2019, the 35th GST council meeting was held in New Delhi. It was the first one held under Nirmala sitharaman, the Union finance minister. The finance minister discussed the simplification of GST rules and about bringing more items under the ambit of GST rates.

Generally, the council meeting is held prior to the general elections, but the meeting could not be held because of the election pressure.

Other discussions held were about tax evasion issues, new GST returns filing system, electronic invoices system, anti-profiteering Authority, and others.

The question of setting up an appellate tribunal for all the Union territories and one for the North-Eastern states were also raised and discussed.

There was deliberation held on the reduction of the tax slab on electric vehicles from 12 to 5 percent; however, without having reached any conclusion.

The key highlights of the discussions held in the meeting are the following-

The introduction of aadhar permit for GST registration– the GST registration being troubling in nature due to a lot of paperwork has been soothed down by attempting to reduce the paperwork. This has been done with the introduction of a new system by the GST council for the verification of the taxpayers registering themselves under GST at the same time while generation aadhar number will be linked to GSTIN. Once Aadhaar card is submitted no other documents would be required as proof and authentication can also be done using Aadhaar OTP.

Extension of the GST annual return due date– an official notification has to be made yet, for the extension of the due date for filing GSTR-9, GSTR-9A, and GSTR-9C and the extension is permitted for two months from now, which is up till 31 August 2019.

Penalty for the delay in hoarding profiteered money– GST Council raised the punishment for deferring surpassing over 30 days. A 10% punishment is charged from keeping a profiteered sum. This measure urges the taxpayer to submit the filing on-schedule.

NAA regime- GST council extended the tenure of the National Anti-profiteering Authority to two more years. Thereby facilitating an approach on all the balance pending cases, left previously. NAA possession was given for the GST annual return last date by 30 Nov 2019. Consequently, the authorities are allowed to begin with new cases because of bringing down interest rate issues, where the GST Council intends to streamline the GST rates.

E-billing made mandatory for theaters– in order to curb black ticketing and tax evasion by the theaters the council has decided to implement e-ticketing for theaters with more than one screen. The electronic ticketing system has been approved.

Non filing of GST returns will result in blocked e way bills– the law expressed that where the GST yearly returns in GSTR-3B/GSTR–4 isn’t required to be petitioned for two successive tax periods, e-way charge age impairing accomplished for such citizens and are brought to force from 21 August 2019, rather than 21st June 2019, which was the prior advised timeframe. New GST returns recording methodology would be completely made viable from the first January 2020.

GST appellate tribunal– The GST council expressed for the last time on the legal expert for the Goods and Service Tax Appellate Tribunal and will parley on the petitions that appeared from Central and state charge experts’ in-house dispute resolution framework. The quantity of GSTAT required will be chosen by the state bringing about two courts in a solitary state.

The proposal has been referred to the Fitment Committee for check of the possibility of cut down the GST rates on electric vehicles and electric chargers, and therefore the proposal has been deferred for the following Council meeting. In the present circumstances, there are no progressions in 12% and 28% of the GST rates for electric vehicles and electric chargers.

Suggestions will be made by the fitment committee by the next council meeting regarding the solar power generating systems services, goods valuation rules, placing of wind turbines.

Lottery for a rate cut is put on hold – There was a discussion about the lottery rate cut in one shot and exhibited two pending cases concerning this before the high court and supreme courts. Regardless of these, the issue is alluded back to GST Council by the court, for basic leadership in the wake of counseling the Attorney General of India.

So as to give enough chance to the citizens and also to the system to adjust to the new return framework will be presented in a phased way, being executed in different phases. The subtleties of this new return structures are portrayed as beneath –

Between July 2019 to September 2019, the new return framework (FORM GST ANX-1&FORM GST ANX-2 only) to be accessible for preliminary for citizens. Citizens to keep on recording FORM GSTR-1 and FORM GSTR-3B as at present;

From October 2019 onwards, FORM GST ANX-1 to be made obligatory. Enormous citizens (having a total turnover of more than ₹ 5 crores in the earlier year) to document FORM GST ANX-1 on a month to month premise while little citizens to record the first FORM GST ANX-1 for the quarter October 2019 to December 2019 in January 2020;

For October and November 2019, huge citizens to keep on documenting FORM GSTR-3B on a month to month premise and will record first FORM GST RET-01for December 2019 in January 2020. It might be noticed that solicitations and so on can be transferred in FORM GST ANX-1 consistently both by enormous and little citizens from October 2019 onwards. Structure GST ANX-2 might be seen at the same time during this period yet no activity will be permitted on such FORM GST ANX-2;

From October 2019, little citizens to quit recording FORM GSTR-3B and to begin documenting FORM GST PMT-08. They will record their first FORM GSTRET-01 for the quarter of October 2019 to December 2019 in January 2020;

From January 2020 onwards, FORM GSTR-3B to be totally eliminated.

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Benefits of having a Registered GST number and honestly paying for it

GST Registration

If you do any kind of business you must know about GST, but those who do not know about GST let us briefly explain it to you. A GST or The Goods and Service Tax is a single or indirect tax which is charged on the supply of all kind of goods and services be it the hotel or restaurant services, or the airplane services, shopping services, the factories, and many others, you can name any of the business where some kind of goods and services are provided the GST would be charged.

GST may sound little or complicated term but it is a very simple, comprehended and multi-stage tax which is charged on every value added to the goods. The GST came into force on 1st July 2017 and it took 17 years for the govt to make this force in the present economy. There are a lot of benefits who have registered for GST, those who have already registered for GST would know about its benefits, but those who do not know here are some of them:

Limited Tax Payment:

When you become a registered GST number holder the first and foremost benefit you have that the rate you pay for the taxes is minimal like you are a goods trader then you pay including the state GST and central GST is 1%, if you are restaurant owner then you pay for both GST is 5% and if you are other service providers is 6%.

New GST Rate 2019

Simple procedures:

The whole GST process which includes the registration for GST, filling a return for it and paying is now online, hence it has now become convenient for everyone especially for the one who has a new business or have a start-up since they have to do multiple procedures for getting other registration such as VAT registration, excise and service tax and etc.

Lower tax rates for small business owners:

Due to the earlier tax rates and the vat rates, the small business owners had to pay a lot of money in the name of taxes and they do not get much of profit from it too. But with GST, the small business owners get lower tax rates under the Compositions scheme whose business turnover is 20 to 75 lakhs. This is a relief for all the small business owners or the one who are new business owners as they can now save money and concentrate more on their business rather compiling documents for tax payments.

The unorganized sector now is regulated:

Certain industries like textile and construction companies were largely unorganized, they even did a lot of tax thefts since nothing was organized before the GST came. But now in GST, every payment has to done online and they can only avail the credit when the supplier has accepted the amount. So, now the tax theft is really impossible and one has to mention everything about their property or business while filling for GST.

improved logistic status:

Due to the application of GST, now the commercial owners do not have to pay extra cost during the delivery since now they do not have put extra warehouses in every city to cut the cost of current CST and the state entry taxes. Instead of setting warehouses in every city they can now set-up the warehouses at the strategic location which very much cost-effective for sellers. This has increased convenience for both the seller and the consumer which has cheapened the rates too.

Better treatment for online companies:

We love online shopping aren’t we because we have a lot of benefits from it but do you know how difficult it was to set up and deliver products to our over convenience for the E-commerce companies like Flipkart or Amazon? Yes, before GST, all the e-commerce companies had to register their VAT number differently for different cities plus they have to mention their vehicles numbers and license numbers and even stopped by the authorities if they do not have proper papers. With Gst, all the confusing process and the extra tax payments are removed and the rules are made which is done for all over the country, now there is no problem for the transportation of goods from one place to another.

Doesn’t matter if you own a small business or just have started your start-up or business everyone has a right to save some money, sometimes the amount or the burden of taxes become too much that it starts affecting the amount or the profit for the business. With GST, most of the extra cost is canceled since now you have to pay at one place rather than paying for different other taxes. So, now you can concentrate on how you can make your business big since you have all the govt support.

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GST Composition Scheme Explained For SMEs in India

GST Composition Scheme

The Goods and Services Tax (GST) is one of India’s most comprehensive and widely discussed economic policies in recent years. Unlike demonetization which largely drew the ire of various sections in society, media, and academia, the GST has prompted a mixed set of critiques. Although the allure of a comprehensive single taxation system, spanning the wider regional disparities of the nation is attractive, the intricacies of its implementation can tilt outcomes in one way or the other. The effects of the GST system are also different for different categories of businesses and individuals, with larger ventures usually possessing the necessary resources and expertise to navigate this complex accounting labyrinth. What, therefore, is the way out for small or medium-scale businesses which often do not have extensive resources at their disposal? The GST Council has recently announced the composition scheme which allows for a special tax-payment provision for certain eligible businesses. SMEs with an annual turnover of below 1 crore (and 75 lakh in particular states such as the North East) have the option of paying tax at a minimum favorable rate, ensuring better tax compliance and a smoother compliance process.

This GST composition scheme has certain fixed eligibility criteria. Besides the stipulation related to annual turnover rate, the SME concerned must be a supply business and operate intra-state only. Service providers are not eligible, with the exception of restaurant owners. Furthermore, at any point in the year, if the turnover rate exceeds the stipulated amount, the business will no longer be eligible to file GST under this particular scheme. The business must also not be associated with any electronic commerce operator such as Amazon or Flipkart. Multiple business verticals associated with the same PAN are considered under the same composition scheme and the businesses are not allowed to extract the composition tax from the customer or charge Input Credit Tax. The applicable rates (as a percentage of turnovers) are 1% for traders and manufacturers, 5% for restaurants, and 6% for other service providers. In order to be eligible, the business must indicate the same on the GST portal before the beginning of the fiscal year. This process involves filing a GST Form 02 at the time of registration and filing the GSTR 4 by the 18th the month falling after the quarter for which GST is being paid. A delay in the filing of GSTR 4 will attract a fine of Rs. 50 per day (Rs. 20 in the case of nil returns). For taxpayers under the composition scheme, GSTR Form 9(A) is the required form for filing tax returns. This must be filled by 31 December of the following financial year, failing which a fine of Rs. 200 per day (Rs. 100 for nil returns) will be charged. The composition scheme, to be started from the 2019 fiscal year carries a number of benefits for eligible businesses. Not only does it make the process of tax compliance easier, it significantly reduces compliance costs for small businesses which are the most severely impacted by minor changes in the economic landscape.

The MSME (Micro, Small, and Medium Enterprises) sector is one of the most prolific and vibrant in the country today. Data from the National Sample Survey Office (NSSO) estimates that in 2015-16, there were over 63 million MSM Enterprises. These created an estimated 110 million jobs and contributed a staggering 29% of the Gross Domestic Product (GDP). The MSME sector is also particularly important as India progressively moves towards an urbanized and technologically connected future. Data from the Census of 2011 tells us that 31% of India’s population is urban and both Census and NSSO estimates present a picture of rapidly growing rural to urban migration in recent decades. The post-1991 liberalization years have been the main driver of this kind of growth and it can be expected that India’s urban population will skyrocket in the coming years. The role of MSM Enterprises in this kind of economic growth and development is massive in terms of contribution to GDP, productivity growth, employment generation, and related outcomes such as social sector inclusivity and income mobility. Therefore, the particular attention paid to the composition scheme is a much-needed acknowledgment of the importance and contribution of the MSME sector to the economy as a whole.

However, despite positive steps in the right direction, there are some hurdles that continue to prevent effective inclusion for the MSME sector. Despite the staggering numbers presented in Census and NSSO data, the conditions for inclusion are so steep that as of 2018, 1,765,684 enterprises had registered under the composition scheme. Although the recent adjustment of the 1 crore turnover condition to 1.5 crores is expected to increase this number substantially, a large number of MSME ventures will continue to be excluded on the grounds of additional conditions involving the inter-state supply of goods and sale on e-commerce platforms. The composition scheme, although a vital economic tool for streamlined and higher growth in the MSME sector, must be adjusted in the coming years to make it more inclusive for the MSME sector, as a whole.

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GST Rates 2019 – New GST Rates Applicable From January-2019

New GST Rates

GST is the principal tax-related reform in the country bringing equality in the taxation structure and eliminating the cascading of taxes that were levied in the past. The GST Council meets from time to time to revise the GST rates for various products. Several states and industries recommend reduction in GST tax rate for various items which are discussed in these meetings.

Finance Minister Arun Jaitley said that the government wanted to keep the GST rates close to the original rates. But there were differences in case of some items because of the changes in the economy as well as customer preferences. Some commodities were kept in the high tax bracket (18-28%) but on scrutinize the list, they found that these commodities should be considered as necessities and not luxuries. This is why the GST rates were revised for commodities such as notebooks, exercise books, spectacles and lenses and some other items.

GST Tax Rates on some common items

TAX Rates

Products

5%

 Household necessities such as edible oil, sugar, spices, tea, and coffee (except instant) are included. Coal, Mishti/Mithai (Indian Sweets) and Life-saving drugs are also covered under this GST slab

12%

 This includes computers and processed food

18%

 Hair oil, toothpaste and soaps, capital goods and industrial

intermediaries are covered in this slab

28%

 Luxury items such as small cars, consumer durables like AC and Refrigerators, premium cars, cigarettes and aerated drinks, High-end motorcycles are included here.

GST Rates on Goods

The government has proposed a 4-tier tax structure for all goods and services under the slabs- 5%, 12%, 18% and 28%. After the recent revision of GST rates, these are the commodities that fall under the four tax slabs along with those that do not attract any tax. Please note that only those commodities are included in this list whose rates have been revised in various council meetings.

Let us have a look at various products and the tax slab in which they fall into :

List of Goods and Services under 0% GST Rate (No tax)

With the implementation of GST, there will be no tax for the following goods as well as services throughout India.

Goods:-

Unpacked foodgrains, fresh vegetables and fruits, unbranded atta, maida, besan, gur, milk, eggs, curd, lassi, unpacked paneer, unbranded natural honey, palmyra jaggery, all types of salt, fresh meat, fish, chicken, buttermilk, cereal grains hulled, Jute, flour, bread, prasad, bindi, sindoor, stamps, judicial papers, printed books, newspapers, bangles, handloom, Bones and horn cores, bone grist, bone meal, etc;, hoof meal, Kajal, Children’s’ picture, drawing or colouring books, Human hair.

Services:-

Under GST, all hotels and lodges in India with tariff below Rs.1,000 are exempted from paying taxes.

Rough precious and semi-precious stones will be taxed at 0.25% all over India.

gst-0percent-tax-rate

List of Goods and Services under 5% GST Rate:

Goods:-

Apparel below Rs 1000, footwear below Rs 500, Sugar, tea, roasted coffee beans, edible oils, cream, skimmed milk powder, fish fillet, branded paneer, frozen vegetables, coffee, spices, pizza bread, rusk, sabudana, kerosene, coal, medicines, stent, lifeboats, Cashew nut, Cashew nut in shell, Raisin, Ice and snow, Biogas, Insulin, Agarbatti, Kites, Postage or revenue stamps, stamp-postmarks, first-day covers.

Services:-

Transport services (Railways, air transport), small restaurants.

gst-5percent-tax-rate

List of Goods and Services under 12% GST Rate:

Goods:-

Cell phones, Apparel above Rs 1000, sewing machine, umbrella, Ayurvedic medicines, tooth powder, Butter, ghee, almonds, fruit juice, packed coconut water, preparations of vegetables, fruits, nuts or other parts of plants including pickle, murabba, chutney, jam, jelly, bhujia, namkeen, fruit juices, frozen meat products, dry fruits in packaged form, animal fat and sausage, cheese, colouring books, picture books, Ketchup & Sauces, All diagnostic kits and reagents, Exercise books and notebooks, Spoons, forks, ladles, skimmers, cake servers, fish knives, tongs, Spectacles, corrective, Playing cards, chess board, carom board and other board games like ludo.

Services:-

Non-AC hotels, business class air ticket, State-run lotteries, fertilisers, Work Contracts.

gst-12percent-tax-rate

List of Goods and Services under 18% GST Rate:

Goods:-

Footwear above Rs.500, camera, speakers and monitors, Headgear and parts thereof, Trademarks, goodwill, software, Bidi Patta, Biscuits – All categories, flavoured refined sugar, pasta, cornflakes, pastries and cakes, preserved vegetables, jams, sauces, soups, ice cream, instant food mixes, mineral water, tissues, envelopes, tampons, notebooks, steel products, printed circuits, Kajal pencil sticks, Aluminium foil, Weighing Machinery [other than electric or electronic weighing machine]. Printers [other than multifunction printers], Electrical Transformer, CCTV, Optical Fiber, Bamboo furniture, Swimming pools and paddling pools, Curry paste; mayonnaise and salad dressings; mixed condiments and mixed seasonings.

Services:-

AC hotels that serve liquor, telecom services, IT services, branded garments and financial services, Room tariffs between Rs. 2,500 and Rs. 7,500, Restaurants inside five-star hotels.

gst-18percent-tax-rate

List of Goods and Services under 28% GST Rate:

Goods:-

Automobiles, Motorcycles, ATM, washing machine, shavers, hair clippers, Bidis, chewing gum, molasses, chocolate not containing cocoa, waffles and wafers coated with chocolate, pan masala, aerated water, paint, deodorants, shaving creams, after shave, hair shampoo, dye, sunscreen, wallpaper, ceramic tiles, water heater, dishwasher, weighing machine, vending machines, vacuum cleaner, aircraft for personal use.

Services:-

Cinema, 5-star hotels, Private-run lotteries authorised by the states, hotels with room tariffs above Rs 7,500, race club betting.

gst-28percent-tax-rate

GST Rates on Services

The government has also impose GST on Services with the same 4-tier tax structure as of goods. GST rates on services comprising of 5%, 12%, 18% and 28% come with various pros and cons for the consumers. However, the government has exempted healthcare and educational services from the purview of the GST.

The Goods and Services Tax council has passed the rate slabs at NIL, 5%, 12%, 18%, 28%. Some of the services categorized under different slabs are mentioned below :

GST on Cars

Subsequent to bringing cars under the GST regime, the GST rate on cars has been fixed at 28% for all personal use vehicles featuring a petrol or diesel driven engine. However, in addition to GST, a composition cess is also applicable to cars over and above the GST Rate. Thus the overall tax rate applicable to vehicles under GST ranges from 29% to 50%. Lower rates of taxation are however applicable to cars driven by cleaner technologies such as fuel cells (including hydrogen fuel cell) and electric vehicles.

GST on Gold

Subsequent to the introduction of GST on items made from gold such as gold jewellery, the current GST rate on gold is 3%. However, a 5% GST rate is applicable to making charges applied to gold jewellery in case the manufacturing is outsourced to a job worker. This can, however, be charged as an input tax credit (ITC) by the jeweller and only a 3% GST charge is applied to the final bill paid by the purchaser of gold jewellery items.

GST On Real Estate

GST is applicable to real estate purchases only if you are purchasing an under construction property. The GST rate applicable to such transactions is 12%. No GST is applicable in case you are purchasing a ready to move in property. Additionally, different GST rates are applicable to various building materials used in the construction of houses/flats. This can range from 5% (sand, marble rubble, etc.) to 28% (cement, etc.).

GST on Food

Food items especially fresh food mostly carry a Nil GST rate. However, packaged foodstuff and semi-processed/processed foods do feature GST rates starting from 5% up to 18%. While no foodstuff are currently included in the highest 28% GST bracket, the 18% rate of GST is applicable to some common food products such as chocolates as well as baked goods such as cakes.

Upcoming products in GST Rates Slab

The Government is going on with some new tactics to bring in some of the products under the GST system. As hinted by Finance Minister, Arun Jaitley, there could be an inclusion of products under GST with the reduction of GST rates on some products. Major products which can come under GST rates slab includes:

1) Petroleum products- Petrol and Diesel

2) Land

3) Electricity

4) Others

GST Rates Impact on the Economy

GST has transformed the economy at its peak. It’s a game-changing reform for the Indian economy as it brings about net appropriate price for the goods and services considered under a single taxation system. Mentioned below are some of the important GST rates impacts in the Indian economy :

Increase in Competition: After the GST has been imposed, there has been seen a fall in prices of goods and services which ultimately has brought the final consumer to have less tax burden on the goods and services. There is seen a great scope of increased production, thus, increase in competition.

Simple Tax Structure: GST has simplified the calculation of tax with the adoption of a single taxation system. Under this, multiple taxations have been aborted which ultimately saves time and money.

Uniform Tax Regime: Previously, there used to be multiple taxes at every stage of the supply chain, where the taxpayer got confused. But now, with GST, it is easier for the taxpayer to pay a uniform tax.

Increase in Exports: There has been seen a fall in the cost of production after the GST got imposed. This in return has brought competitiveness towards the international market resulting in rising in exports.