Direct Taxes

GST : Explained

August 23, 2016 July 09, 2016 Admin

Blog – Goods & Services Tax.

GST:- Explained

The major reform for India after the libralisation of economy in 1991 , “THE GST BILL” has been passed by Government of India and would be rolled out by 1st April 2017 , The documents provides basic and important highlights about the new GST bill prapossed and passed by Government of India.

  1. What is GST ?

    GST stands for Goods & Services Tax.

  2. Which types of taxes will be replaced by GST.

    GST will replaces the following taxes charges currently on various products & Services.

    • Central Excise duty,
    • Additional Excise duty,
    • Service tax,
    • Additional Custom duty and
    • Special Additional duty
    • VAT/CST
    • Entertainment tax,
    • Entry tax,
    • Purchase tax,
    • Luxury tax
    • Octroi
  3. Types of GST the Government is Introducing ?

    There are three types of GST as follows :-

    CGST – Central Goods & Services Tax
    Central Tax to be levied on intra state Transaction to be charged in each invoice

    SGST – State Goods &amp Services Tax
    State Tax to be levied on intra state Transaction to be charged in each invoice

    IGST – Integrated Goods & Services Tax
    Integrated tax to be levied on the Interstate transaction, to be charged on the invoices raised for sale to another state.

    So every invoice will have either CGST & SGST or IGST.

  4. What is the Rate of GST to be charged ?

    The Government has not yet finalised the rates but the rate of GST is expected to range in different slabs with the standard rate to be 18-20% for goods and 16-18% for Services.

  5. What will be the tax rate of IGST ?

    The Tax rate of IGST will be addition of CGST+SGST

  6. What is the threshold limit for Registration under GST

    A person is required to registered under CGST/SGST only if its turnover exceeds 9 Lacs & 4 Lacs for the North East states.

  7. What is the threshold limit for payment of Taxes under GST

    A person is required to pay GST if its turnover exceeds 10 Lacs & 5 Lacs for the North East states.

  8. How to Get Registration under GST ?

    Registration will be linked to the PAN Number, All the existing registration holders under the current tax regime will be allotted the GST number and New Registration shall be applied in a one page comprehensive form with the required documents.

  9. When the Liability of GST arises ?

    The liability of GST (CGST/SGST/IGST) arises at the “time of Supply” of Good.

  10. What would be the “Time of Supply” for the GST Liability for removable goods ?

    The Time of supply of goods under GST shall be the earliest of the following :-

    • Date of Removal by supplier to recipient
    • Date on which goods are made available to recipient
    • Date of Issue of Invoice by supplier
    • Date on which the suppliers received the payment.
    • Date of receipt of goods by recipient

    The Time of supply of goods under GST for non movable goods shall be the date on which the goods are made available to the recipient.

  11. What would be the value of Taxable supply under GST ?

    The value of supply of goods shall include the following

    • The Price actually paid or payable.
    • Any amount the supplier pays in relation to supply of goods not included in above price
    • Any Taxes, Duties, Fees and charges levied under any other statues
    • Incidental expenses in connection with supply e.g. Commission, packaging etc.
    • Subsidies, Discounts, Reimbursable expenses, Incentive.
  12. Is there any composition scheme under GST Law ?

    The Registered tax payer whose aggregate turnover in any financial year does not exceed Fifty Lac Ruppes may opt for composition scheme to pay taxes at fixed rates, without taking credit of any input.
    No such permission will be granted if the tax payer effects Interstate sale.

  13. What is periodicity of Return Filling for Regular Tax Payer ?

    Post registration , every tax payer has to file regular returns under GST. The return filling forms for a regular tax payer would be as follows as proposed:-

    GSTR 1 Outward Supplied Return 10th of Next Month
    GSTR 2 Inward Supplies return 15th of Next Month
    GSTR 3 Monthly Return 20th of Next Month
  14. Periodicity of Return Filling for Tax Payer under Composition Scheme.

    Tax payer opting for Composition scheme will have a fixed rate of tax and no input claims allowed, hence he return filling forms for such tax payer would be a single form as follows:-

    GSTR 3 Quarterly Return under fixed rate 18th of Next Month
  15. What is the rules of Input Tax Credit for CGST , SGST & IGST

    CGST & SGST cannot be cross utilised for Input credit i.e Input CGST can be used only for Output CGST similarly Input SGST can be used only for Output SGST
    CGST & SGST can be cross utilised for the IGST , i.e an Input CGST/SGST can be utilised to pay Output IGST and similarly Input IGST can be utilised to pay output CGST/SGST.

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