Working Model of GST
With GST in vogue, the taxable event for levy of GST shall be termed as ‘supply’ of goods and/ or services. The term ‘supply’ is defined inclusively to cover general supply and deemed supply.General supply incorporates all types of supply of merchandise as well as administrations, for example, deal, exchange, deal, trade, permit, rental, rent or transfer made for a thought. Esteemed supply incorporates indicated exchanges made without thought.
Nature of Supply is further divided as –
• Interstate vs. Intrastate supplies
Central GST (CGST) and State GST (SGST) will be leviable on intraState supplies and Integrated GST
(IGST) will be leviable on interState supplies.
IGST will be summation of CGST and SGST.
Supply of goods and/or services shall be Interstate if ‘location of supplier’ and ‘place of supply’ are
in different States. Otherwise the supply will be Intrastate. ‘Location of supplier’ is generally the
registered place of business. ‘Place of Supply’ of services generally is the location of service
receiver.
Impact of GST
Accordingly, if service provider and service receiver are located within a state, the same will be Intrastate
supply liable to CGST/SGST. However, if service receiver is located in a different state, the
transaction will be Interstate supply liable to IGST.
Time of Supply and Valuation
The provisions relating to time of supply and valuation are more or less on the same lines as existing in
the current service tax regime.
Impact
Accordingly, time of supply of services shall be date of invoice or date of receipt of payment, whichever
is earlier. In case invoice is not issued within prescribed time, time of supply will shift to the date of
completion of service. The value of service shall be the price actually paid or payable for supply.
Place Where Tax to be Deposited
Taxable person is one who carries on business at any place in India and who is liable to be registered.
Person is liable to be registered in the State from where supplies are made.
Impact
Tax is to be deposited in the State from where supply is made by the supplier. There are no clear
provisions to determine the place from where supplied are made.
Registration
Every office of chartered in different state has to take separate registration. There is no concept of
centralized registration as of now.Existing citizens will be conceded enlistment on temporary premise
substantial for 6 months.
Input Tax Credit
Input Tax Credit (ITC) is available in respect of inputs, capital goods and input services. There is a
negative list of items on which no ITC is available.
ITC is available only on provisional basis until the supplier makes the tax payment and files a valid
return. There will be matching of supplier and receiver data and credit will be confirmed only after such
matching. Where the data is not matched and where the supplier has not made the tax payment, the
ITC shall be reversed with interest. Interest is from the date of wrong availment or utilization.
Returns
Experts like CA, CS and CMA are obligated to record GSTR 1 (Statement of outward supplies), GSTR 2(Explanation of internal supplies), GSTR 3 (Statement of conclusive assessment and GSTR 8 (Annual return). Further,
they may likewise be required to record GSTR 7 (Statement of TDS).
Payment of Taxes
Prioritization manage has been embedded for installment of expenses whereby charges for the present time frame can’t
be paid until the expenses/intrigue/latefee/punishment in connection to returns of past duty periods have not been stored.
Transitional Provisions
Measure of CENVAT credit conveyed forward in an administration expense form will be permitted as ITC under GST.
However such convey forward is permitted just if the credit is permissible regarding the ITC arrangements of the GST Law. Detailed procedure in this regard will be framed in the Rules to GST Law.
Certicom offers all services related to GST starting from registration to final steps.
