As we know Goods and Service Tax (GST) will 100% be implemented on 01-07-2017. Here are some point which help you to understand the whole concept of GST.
- Types of taxation in GST:-
IGST : Integrated GST
CGST : Central GST which with replacement CST
SGST : State GST which will replace VAT
- WEF from 1.6.17 : Migration towards enrolment of GST will start till 15.6.17
- Registration certificates will be issued online.
- There will be no check post for 1 year. Only mobile check posts will be in full force. All intelligence officers will be dormant for sometime.
- 5 forms on different dates have to be submitted every month:
*R1 form on 10th
*R2 form on 13th
*R3 form on 15th
*R4 form on 17th
*R5 form or final returns on 20th
- You cannot file revised returns at all. Once filed on 20th is final.
- Tax payments will be accepted only by e payments. Tax Payments via credit & debit card also added.
- In the present Vat system you upload sales & purchases every month. In GST you have to upload every sale & purchase bill.
- Be careful, everything in GST is system driven. Once uploaded you cannot revise anything. No officer can help you in this. They can only pity the mistake.
- Your firm rating will be done by the system. Based on the rating audit trials will be conducted.
- Proposed e-sugam for ₹50000 & above value only.
- Proposed rates of GST in percentage are 0, 5, 8, 12, 18, 28 & 40.
- 1st time in the history of independent India 4 major category of businesses will be covered: Education, Textiles, and Medical & Professional services.
- You need to submit 17 documents for migration to GST.
- Most products MRP to come down. Distribution + C & F channel under threat.
- All these categories which were not taxed will now be taxable: Replacements/ return goods, Barters, Free Samples, disposables, scrap material. For example : if you buy a 40 inch led TV from Girias for ₹30000 & return back your old TV in exchange for ₹4000, you have to pay tax on ₹34000.
- All movements of material will be taxable like: Head office to branch office (stock transfer), factory to C & F agent, godown to shop.
- The GST officer has all rights to value your goods & fix the price. The law will decide Valuation of the product at various levels like: Manufacturing, Wholesalers, Distribution & retailers. For example if Kissan is selling Jam for ₹150 & Patanjali is selling the same Jam for ₹120. (Same quantity, flavor, ingredients etc.) Then Patanjali has to pay tax on ₹150.
- All books & records to be maintained on daily basis.
- You will need a full time accountant in your shop/office to maintain books under GST.
- All travel & tour expenses related to business have to be claimed under firm name.
- If your vendor does not upload his bills within 180 days, you will not get tax credit.
- You cannot claim credit for material in stock beyond one year.
- They propose that you have to dispose all your old stocks purchased under VAT/CST within September 2017.
- All VAT related documents like C forms, F forms etc have to be cleared within Sept 2017. Your Vat credit will not be carry forwarded to GST.