1. GST (GOODS & SERVICE TAX) By Hemant Tiwari

2. Basics about GST What is GST??
GST is a destination based tax on consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as setoff. In a nutshell, only value addition will be taxed and burden of tax is to be borne by the final consumer. Here taxable event is SUPPLY.
Explanation-
(a) Destination based tax on consumption- If A in Gujarat produces the goods and sells the goods to B in Rajasthan, then in such case the tax should be levied and collected and should accrue on the goods in the State of Rajasthan and not in the State of Gujarat.

3. Earlier - (b) Goods and Services both are covered under GST.
Taxable goods and services are not distinguished and are taxed at a single rate in a supply chain till the goods or services reach the consumer.
Exports would be considered as zero-rated supply and imports would be levied the same taxes as domestic goods and services adhering to the destination principle in addition to the Customs Duty which will not be subsumed in the GST.
Excise Duty on Production of Goods exceeding Rs Crore
Vat on Intra State Sale of Goods as per State limit
CST on Inter State Sale of Goods
Service Tax on Services exceeding the Limit of Lacs

4. Why GST is Necessary ?. Issue in existing tax regime
GST tax System_ benefit
Cascading Effect _ Means tax on tax
Multiple tax leads increase in compliance cost
Due to heavy cost exporters are not able to compete with world
Was Difficult to curb black money”& Corruption
Inefficient dispute resolution system in the current indirect tax regime.
All Major Indirect Taxes are subsumed into one Tax. Saving in compliance & procedural cost for businessman as well for government
Free flow of Input Tax credit means no cascading effect _ Tax on Tax
Transparency in Tax flow ( Everything will be online through GSTN)eventually help to curb black money & corruption
Effective dispute resolution system will attract foreign investor
Indian market will be more competitive with the world
Overall Growth in economy

5. GST FRAMEWORK There are two forms of GST in INDIA .
Intra state level : Intra State Level means when goods travel within same state and territory
Inter state level: Inter state level means when goods travel between different states and different
territories.
At the Intra-state level two types of GST shall be levied: CGST(Central Goods and Services Tax) and SGST(State Goods and Services Tax).
At the Inter-state level, IGST (Or Integrated Goods and Services Tax) shall be levied.

7. Taxes subsumed under CGST

8. Taxes subsumed under SGST

9. Taxes not subsumed under GST
Basic Custom Duties
Excise on liquor
Property Tax
Stamp Duty
Tax on sale/consumption of electricity

10. Products not covered under GST
Petroleum Crude
Motor Spirit(Petrol)
High Speed diesel
Natural Gas
Aviation turbine fuel
Liquor
Note : - What will be status of Tobacco and Tobacco products under the GST regime?
Ans: Tobacco and tobacco products would be subject to GST. In addition, the Centre would have the power to levy Central Excise duty on these products.

11. Input credit system
CGST
IGST
SGST

12. Applicability of GST
Every supplier shall be liable to be registered under GST in the state from where he makes taxable supply of goods and/or services if his aggregate turnover in a financial year exceeds threshold limit.
Rs. 20 lakh OR
Rs. 10 lakh in North Eastern States including Sikkim.

13. In The Following cases Registration is required irrespective of the above limits.
If you are purchasing or selling goods outside the state irrespective of the limit ( Inter State Supply).
If you are receiving or providing services outside the state irrespective of the limit ( Inter State Supply) .
If you are required to pay tax under reverse charge.
If you are non-resident taxable person irrespective of the limit.
Input Service Distributor
An aggregator who supplies services under his brand name or his trade name irrespective of the limit.
Every electronic Commerce operator like Flipkart, Amazon, etc., irrespective of the limit.
A person who supplies goods and services through electronic commerce. In other words, if you want to sell on Flipkart, Amazon, then you will need to register yourself first irrespective of the limit mentioned.

14. Any person who is required to deduct TDS under GST (not under Income Tax Act, 1961).
PAN BASED AND STATE SPECIFIC: Every person who is liable to be registered under this Act shall apply for registration in every such State in which he is so liable within thirty days from the date on which he becomes liable to registration.
REGISTRATION NOT TAX SPECIFIC: Which means that there is single registration for all the taxes i.e. CGST, SGST/UTGST, IGST and cesses.
A person having multiple business verticals ( Business Segments) in a State may obtain a separate registration for each business vertical, subject to such conditions as may be prescribed.
VOLUNATARY BASIS: A person, though not liable to be registered under Schedule V, may get himself registered voluntarily, and all provisions of this Act, as are applicable to a registered taxable person, shall apply to such person.

15. What is GSTIN?
Each taxpayer will be allotted a state-wise PAN-based 15-digit Goods and Services Taxpayer Identification Number (GSTIN).  Here’s a complete break-up of the proposed GST Identification Number.
The first two digits of this number will represent the state code as per Indian Census 2011
The next ten digits will be the PAN number of the taxpayer
The thirteenth digit will be assigned based on the number of registration within a state
The fourteenth digit will be Z by default
The last digit will be for check code. It may be an alphabet or a number generated by the system on the basis of other 14 digits.

16. TAXABILITY UNDER GST
Under GST, the existing system of levy of tax on manufacture, provision of taxable services, and sale of goods will be replaced by the concept of ‘SUPPLY’. Therefore, the taxable event under GST is the ‘Supply’ of Goods or Services.
Supply will Include-
Sale, Transfer ,Barter, Exchange ,License ,Rental, Lease, Disposal in course of business.( no GST on sale of Private car or assets).
Importation of services ,whether or not in the course of business
Stock Transfer
Gift by Employer to Employee ( Beyond 50K) etc
Further under ‘Supply’ there are three important concepts:
Place of supply of Goods/Services
Time of Supply of Goods/Services
Value of Supply of Goods/Service
These three define the incidence of taxability, i.e whether tax will be levied or not, tax type to be levied i.e SGST, CGST & IGST, value of taxable supply of goods/services etc.

17. Place of Supply of Goods/Services
It is very important to understand the term ‘place of supply’ for determining the right charge of tax on ‘supply’. The GST Law lays down the criteria to determine the place of supply. Based on these criteria, you can treat the supply of goods or services as either Intra-State (within the State) or Inter-State (Outside the State).
Domestic Transactions
Recipient Registered Person Recipient Unregistered Person
The place of supply will be the
Location of the service recipient.  Location of the service recipient (if the
address is available on);
Otherwise, location of service provider
International Transactions
The Place of Supply will be location of service recipient .In case where the location of service recipient is not available, the place of supply shall be location of the supplier.

18. Location of the supplier/ receiver
S.No
Case
Location of Supplier/Receiver of Services A
where a supply is made/received from a place of business for which the registration has been obtained
the location of such place of business B
where a supply is made/received from a place other than the place of business for which registration has been obtained (a fixed establishment elsewhere)
the location of such fixed establishment; C
where a supply is made/received from more than one establishment, whether the place of business or fixed establishment,
the location of the establishment most directly concerned with the provision of the supply D
in absence of such places,
the location of the usual place of residence of the supplier/receiver;

19. Time of Supply
Time of supply means the point in time when goods/services are deemed to be supplied/rendered. It enables us to determine the rate of tax, value, and due dates for payment of taxes.
General Rule-
Time of Supply will be the Earlier of the following:
Date of Issue of Invoice
Date on which Invoice should have been issued
Date of receipt of payment

20. Value of Supply
In general, the transaction value is taken as value of supply.
The value of supply under GST shall include:
Any taxes, duties, cess, fees and charges levied under any act, except GST.
Any amount that the supplier is liable to pay which has been incurred by the recipient and is not included in the price.
The value will include all incidental expenses in relation to sale such as packing, commission etc.
Interest/late fee/penalty for delayed payment of consideration will be included.
Pre Supply Discounts or Discounts at the time of Supply will be excluded. Discounts after Supply will not be excluded.

21. GST RATES ( Grouping ) Sr. No. Rate Description 1 0%
Essential items including food 2 5%
Common usage items 3
12% and 18%
Standard Rates 4
28%
Items which are Currently taxable with (30-31%) 5
28% with Cess
Luxury and de-merit Goods

22. Rate applicable under GST on Goods
The Council has broadly approved the GST rates for services at Nil, 5%, 12%, 18% and 28% as listed below.
GST Nil rate (0%):  No tax will be imposed on items like fresh meat, fish chicken, eggs, milk, butter milk, curd, natural honey, fresh fruits and vegetables, flour, besan, bread, prasad, salt, bindi. Sindoor, stamps, judicial papers, printed books, newspapers, bangles, handloom etc.
GST 5% Items List Items such as fish fillet, cream, skimmed milk powder, branded paneer, frozen vegetables, coffee, tea, spices, pizza bread, rusk, sabudana, kerosene, coal, medicines, stent, lifeboats will attract tax of 5 percent. 

23. GST 12% Items list :
Frozen meat products , butter, cheese, ghee, dry fruits in packaged form, animal fat, sausage, fruit juices, Bhujia, namkeen, Ayurvedic medicines, tooth powder, agarbatti, colouring books, picture books, umbrella, sewing machine, and cell phones will be under 12 per cent tax slab.
GST 18% Items list :
Most items are under this tax slab which include flavoured refined sugar, pasta, cornflakes, pastries and cakes, preserved vegetables, jams, sauces, soups, ice cream, instant food mixes, mineral water, tissues, envelopes, tampons, note books, steel products, printed circuits, camera, speakers and monitors.
GST 28% Items list :
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, washing machine, ATM, vending machines, vacuum cleaner, shavers, hair clippers, automobiles, motorcycles, aircraft for personal use, and yachts will attract 28 per cent tax – the highest under GST system

24. GST RATES FOR SERVICES
Service of transportation of passengers, with or without accompanied belongings, by— inland waterways NIL
Services by way of transportation of goods- by inland waterways NIL
Renting of motorcab where the cost of fuel is included in the consideration charged from the service recipient 5% No ITC
Composite supply of Works contract as defined in clause of section 2 of CGST Act %
Pilotage and berthing services %
Port and waterway operation services (excl. cargo handling) such as operation services of ports, docks, light houses, light ships etc %

25. Vessel salvage and refloating services 18%
Other supporting services for water transport (not specified elsewhere) %
Rental services of water vessels including passenger vessels, freight vessels etc with or without operator %
All other services not specified elsewhere %
Note: GST Rate = CGST Rate + SGST Rate.

26. HSN AND SAC code
Harmonized System of Nomenclature” or simply “HSN” is a multipurpose international product nomenclature developed by the World Customs Organization. The purpose of using the HSN codes is to ensure that GST invoicing practices are in tune with international standards of product nomenclature.
How to use HSN AND SAC Codes
Annual turnover Less than 1.50 Crore HSN Code Not Required
Annual Turnover of 1.50 Crore and above but below 5.00 Crore Two Digit
Annual turnover of 5.00 Crore and above Four Digit
Import and Export Eight Digit
The SAC code means Services Accounting Code under which services fall under GST are classified

27. EXAMPLE OF GST COMPUTATION

28. Filling of return and its due date under GST for July and August 2017
GSTR-3B for July 2017
Aug 20th, 2017
GSTR-1 for July 2017
Sep 5th, 2017
GSTR-2 for July 2017
Sep 10th, 2017
GSTR-3B for August 2017
Sep 20th, 2017
GSTR-1 for August 2017
GSTR-2 for August 2017
Sep 25th, 2017

29. Filling of return and its due date under GST From October 2017
Return Form
What to file
By Whom?
By When?
GSTR-1
Outward supplies of taxable goods and/or services effected
Registered Taxable Supplier
10th of the next month
GSTR-2
Inward supplies of taxable goods and/or services effected claiming input tax credit.
Registered Taxable Recipient
15th of the next month
GSTR-3
Monthly return on the basis of finalization of details of outward supplies and inward supplies along with the payment of amount of tax.
Registered Taxable Person
20th of the next month
GSTR-4
Quarterly return for compounding taxable person.
Composition Supplier
18th of the month succeeding quarter
GSTR-5
Return for Non-Resident foreign taxable person
Non-Resident Taxable Person

30. Return Form What to file By Whom? By When? GSTR-6
Return for Input Service Distributor
Input Service Distributor
GSTR-7
Return for authorities deducting tax at source.
Tax Deductor
10th of the next month
GSTR-8
Details of supplies effected through e-commerce operator and the amount of tax collected
E-commerce Operator/Tax Collector
GSTR-9
Annual Return
Registered Taxable Person
31st December of next financial year
GSTR-10
Final Return
Taxable person whose registration has been surrendered or cancelled.
Within three months of the date of cancellation or date of cancellation order, whichever is later.
GSTR-11
Details of inward supplies to be furnished by a person having UIN
Person having UIN and claiming refund
28th of the month following the month for which statement is filed

31. GSTR-1 return will include details of the outward supplies or sales of goods and/or services by the taxpayer. This return form would capture the following information: •Basic details like Business Name along with GSTIN, period for which the return is being filed etc. •Details of invoices issued in the previous month and the corresponding taxes to be paid. •Details of advances received against a supply which has to be made in future. •Details of revision in relation to outward sales invoices pertaining to previous tax periods.
GSTR-2 return will include details of the inward supplies or purchases of goods and/or services by the taxpayer. GSTR-2 is prefilled for a buyer based on the GSTR-1 filed by his supplier. You just have to validate this prefilled information and make modifications if required. For example, if you are buying goods from company B, then the company B would have filed its GSTR-1 and included your name as the buyer. Now the same information will be reflected in your GSTR-2 as purchases which you need to validate. GSTR-2 will thus include the details of auto-populated purchases.
GSTR 3 is a combined version of GSTR 1 and GSTR 2. As in the case of GSTR-2, GSTR-3 is also prefilled for a taxpayer based on the GSTR-1 and GSTR-2. You just have to validate this prefilled information and make modifications if required. GSTR-3 return will include the following details: •Information about Input Tax Credit ledger, Cash ledger, and Liability ledger •Details of payment of tax under various tax heads of CGST, SGST, and IGST •Taxpayer will have the option of claiming a refund of excess payment or to carry forward the credit.

32. GSTR 7 is the return that has to be filed by the tax deductor about tax deducted at source.Deductor is required to file the return and has to provide the detail of amount of TDS in his return. When deductor pays the amount of TDS, it shall get reflected into the credit ledger of the deductee. 
GSTR 9 - All the normal taxpayers would be required to submit annual return under GST. This is intended to provide complete visibility about the activities of the taxpayer. • It will be a detailed return and will capture details of all the income and expenditure of the taxpayer and will regroup them in accordance with the monthly returns. • A major advantage of this return will be that it will provide the opportunity to correct any short reporting of activities undertaken.
GSTR 3B – This is similar to GSTR 3 . All the information filed in GSTR 3B will be matched with GSTR 3 later on.

33. GSTR 1A and GSTR 2A are auto generated informational Forms.
1) Every Seller shall furnish details of outwards supplies of goods or services or both effected during a tax period on or before the tenth day of the month succeeding the said tax period in GSTR-1
2) The Details of the goods sold furnished by Supplier shall be made available electronically to the recipients in Part A of form 2A through the common Portal after the due date of filing of Form GSTR-1
3) Every Recipient shall verify, validate, modify or delete, if required, the details received under form 2A relating to the supplies and credit or debit notes communicated to prepare the details of his inward supplies and credit or debit notes.
4) Every Recipient shall furnish, electronically, the details of inward supplies of taxable goods or services or both on which tax is payable after the tenth day but on or before the fifteenth day of the month succeeding the tax period in GSTR – 2 using the details of modified form 2A
5) The Details of inward supplies added, corrected or deleted by the recipient in his form GSTR-2 shall be made available to the supplier electronically in form GSTR – 1A through the common Portal.

34. INVOICING UNDER GST
When a registered taxable person supplies taxable goods or services, a GST invoice is to be issued. It is based on the rules regarding the details required in an invoice. The serial number shall be furnished electronically in FORM GSTR 1 of invoices issued during a tax period. There are 2 types of documents which will be issued:
GST Invoice
Bill of supply 
Particulars
Name, Address & GSTIN of supplier
Consecutive Serial Number ( Invoice No)
Date of issue (related to concept of Time of Supply)
Name, Address & GSTIN (if registered) of recipient
HSN/SAC code (as per eligibility on turnover basis)
Description of Goods, Quantity & Taxable Value Rate & Amount of Tax – CGST, SGST, IGST
Place of Supply (and Address of Delivery if it is different from POS)
Signature or Digital Signature

36. Bill of Supply
Generally the GST invoice is issued in order to charge the tax from the recipient and also pass on the credit. In GST there are however some instances where the recipient is not a registered person or where the supplier is not allowed to charge any kind of tax and hence a GST invoice can’t be issued. Instead, another document called Bill of Supply is issued.
The Cases where a registered supplier needs to issue the bill of supply:
Supply of Exempted / Nil-rated, Non-taxable / Non-GST goods or services
Paying tax under the composition scheme
The person who is registered as a composition taxpayer shall at the top of the bill of supply issued by him, mention the words- “not eligible to collect tax on supplies”  because person registered as the composite taxpayer is not eligible to collect tax on the supplies from his buyer rather tax is paid by the composite taxpayer himself at the special rates decided for the composition dealers.
GST Invoice to be in Triplicate
Original for recipient , Duplicate for transporter , Triplicate for Supplier.

37. What is E-Way bill and it’s applicability under GST
Official shipping document that travels with a shipment, identifies its consignor, consignee, origin and destination, describes the goods, and shows their weight and freight.
The registered person or transporter may at his option, generate and carry the e-way bill if the value of consignment is less than Rs. 50,000 , for all other case it is mandatory.
During transit one conveyance to other before such transfer and further movement of goods, transporter shall generate a new e-way bill in FORM GST INS-1.(conveyance wise)
In case multiple consignment in on conveyance consolidated e-way bill in FORM GST INS-2 will need to be generated prior to the movement of goods.

38. Validity of E-Way bill in GST
The e-way bill will remain valid for the period as mentioned in following table from the time of generation of e-way bill
SR No
Distance
Validity Period 1
Less then 100 Km
1 days 2
100km to 300Km
3 days 3
300Km to 500Km
5 days 4
500Km to 1000Km
10 days 5
1000km and more
15 days

39. REVERSE CHARGE
Reverse Charge means the liability to pay the tax by person receiving goods and/or services instead of the person supplying the goods and/or services in respect of specified categories of supplies.
(1) Unregistered dealer Supplying Taxable Goods or services to a registered dealer ( Only Intra State Supply) In case of inter state supply there will no unregistered dealer.
Exemption notification No. 8/2017
Exemption is on intra state taxable supply.
There is a limit of transaction value of Rs. 5,000/- per day
Limit is in respect of all suppliers
(2) Services through an e-commerce operator ( E.g Urban clap is liable)

40. REVERSE CHARGE
Reverse charge under GST on services : CBEC has notified a list of 12 services on which tax shall be paid by the
recipient on 100% reverse charge basis:
Non-resident service provider
Goods Transport Agencies
Legal service by an Advocate/ Firm of Advocates
Arbitral Tribunal
Sponsorship Services
Specified Services provided by Government or Local Authority to Business entity
Services of a director to a company
Insurance agent
Recovery Agent of Bank/FI/ NBFC
Transportation Services on Import
Permitting use of Copyright
Radio Taxi services to E-commerce aggregator (eg: Ola, Uber, etc.)

41. REVERSE CHARGE
Issue Invoice for Reverse Charge
The recipient of the supply is liable to pay tax in the case of reverse charge mechanism. Every person who is paying tax on the basis of reverse charge has to mention this fact in his tax invoice that is being issued. A registered person who is liable to pay tax under reverse charge i.e., the buyer has to mandatorily issue an invoice in respect of goods or services received by him from the supplier who is not registered.This will be in Single copy which will be kept for return filing purpose
Input tax credit on reverse charge
Tax paid on reverse charge basis will be available for input tax credit if such goods and/or services are used, or will be used, for business. The service recepient (i.e., who pays reverse tax) can avail input tax credit.

42. Documents required for proper accounting in gst

43. WORK CONTRACT
For GST law, works contract will be treated as a supply of service, thereby putting a closure to the deliberation on the methodology of segregating the works contract between goods and services.
Input tax credit shall not be available in respect of the works contract services when supplied for construction of immovable property,(other than plant and machinery), except where it is an input service for further supply of works contract service i.e credit of GST paid on works contract services will be allowed only if the output is also works contract services.

44. Records To Be Maintained Under GST
Information Required
By Whom?
Register of Goods Produced
Account should contain detail of goods manufactured in a factory or production house
Every assessee carrying out manufacturing activity
Purchase Register
All the purchases made within a tax period for manufacturing of goods or provision of services
All Assessee
Sales Register
Account of all the sales made within a tax period must be maintained
Stock Register
This register should contain a correct stock of inventory available at any given point of time
Input Tax Credit Availed
This register should maintain the details of Input Tax Credit availed for a given tax period
Output Tax Liability 
This register should maintain the details of GST liability outstanding to be adjusted against input credit or paid out directly
Output Tax Paid
This register should maintain the details of GST paid for a particular tax period
Other Records Specified
Government can further specify by way of a notification, additional records and accounts to be maintained
Specific Businesses as notified by the government

45. REFUND CASES UNDER GST
Excess payment of tax due to mistake or inadvertence.
(B) Export (including deemed export) of goods / services under claim of rebate or Refund of accumulated input credit of duty / tax when goods / services are exported.
(C) Finalization of provisional assessment.
(D) Refund of Pre – deposit for filing appeal including refund arising in pursuance of an appellate authority’s order (when the appeal is decided in favor of the appellant).
(E) Payment of duty / tax during investigation but no/ less liability arises at the time of finalization of investigation / adjudication.
(F) Refund of tax payment on purchases made by Embassies or UN bodies.
(G) Credit accumulation due to output being tax exempt or nil-rated.
(H) Credit accumulation due to inverted duty structure i.e. due to tax rate differential between output and inputs.
Year-end or volume based incentives provided by the supplier through credit notes.
(J) Tax Refund for International Tourists.

46. THANKS YOU Hemant Tiwari (Chartered Accountant)
, ,
E mail-
Website- myfinconsultants.com