All You Should Know about GST as a Business Manager
What are the components of GST?
GST is a combined scheme of making central and state taxes together. there are three types of taxes – Central GST and State GST and IGST (Integrated GST) for interstate transactions.
Since every the center and state taxes are combined and made as one tax under GST, state governments and central government will need to have their share of GST. Hence, there will be three types of taxes under GST. Since GST is a consumption-based tax, the tax revenue will be charged and collected by the consuming state. This helps the consuming state to secure their tax base.
If the goods are transferred within state i.e., the consumption state is same as origin state, there will be CGST (Central Government Tax) and SGST (State Government Levy)
When transferring goods from one state to the other, IGST will be charged and the central government will settle the tax to the consuming state.
Will GST bring down my tax burden?
GST plans to reject cascading effect of tax. All inputs credits can be utilized and it will bring down the tax burden on account of usage of credit. The credit can be claimed only after it matches the invoice of the respective suppliers.
In the current tax regime, tax credit claims under various tax laws are not allowed. For eg: tax credit on account of taxes paid under excise duty cannot be claimed against service tax dues and vice versa.
Will GST increase my compliance?
GST looks to minimize the consent trouble of the customers. There is only one consent that is required and only a single compliance has to be done. Under the present scheme, service tax, VAT and other returns are to be filed separately whereas the input tax mechanism under each tax is different.
In GST the acknowledgement are prepared by the GSTN once the person inputs all his purchase and sale details. Matching of invoices for availing input credits are done automatically and returns are prepared.
Once the returns are processed and approved, there are no further returns to be filed on a monthly basis. In the current tax regime, customers have to file and manage all taxes separately excise, VAT, service tax etc.
How to prepare my GST return?
GST returns are been arranged with the help of your invoices for the period of filing of return. The assessee has to upload all his relevant purchase and sales register and other information required like advances with which the returns are automatically generated.
There is a separate way for the agreement of invoices filed and the assessee can work with their vendors for unmatched items post which the final return will be prepared and tax liability has to be discharged.
CGST and IGST are part of GST, Goods and Service Tax.
CGST is known as Central Goods and Service Tax and IGST is expanded as Integrated Goods and Service Tax.
Different indirect taxes of Central Excise Duty, Central Sales Tax CST, Service Tax, Additional excise duties, excise duty levied under the medical and toiletries preparation Act, SAD (Special Additional Duty of customs) surcharges and cesses are merged with CGST. Under IGST, the taxes for movement of goods and services from one state to another are collected.
Most of the share of tax revenue in CGST is allocated for central government and IGST tax revenue is shared between State government and Central government as per the rate fixed by the authorities.
CGST expands as Central Goods and Service Tax and SGST is the expansion of State Goods and Service Tax.
Different indirect taxes of Central Excise Duty, Central Sales Tax CST, Service Tax, Additional excise duties, excise duty levied under the medical and toiletries preparation Act, SAD (Special Additional Duty of customs) surcharges and cesses are merged with CGST. In SGST, the taxes like State Sales, VAT, Luxury, Entertainment tax is so far as they relate to supply of goods and services etc. are subsumed.The most of the share of tax revenue under CGST is allocated for central government where as SGST tax revenue is allocated for state government
