- GST Registration – A company must register for GST if its turnover exceeds Rs.40 lakhs in the case of goods, and Rs.20 lakhs in the case of services. Additionally, businesses can voluntarily register for GST if it will be required unless they are exempt.
- GST Slabs – Using the particular goods and services in question, the entrepreneur can determine the appropriate tax rate. Generally, there are two major classification of gst slabs rates in 2022 – the Harmonized System of Nomenclature (HSN) and the Servicing Accounting Code (SAC). These code slabs are based on legal and logical classification codes with rules that are specific for each type of goods.
- Types of GST –CGST, SGST, UTGST, IGST – As soon as you have registered for GST, you need to know what type of GST will be applicable to invoices issued with the GST number. CGST and SGST will be claimed when goods or services are supplied within a state or intra-state transaction. The IGST will only be collected for supplies between states or interstate transactions; however, when they happen within union territories, the UTGST will be charged.
- Impact of GST on Industry – With a transparent taxation system, it will be impossible to hide the costs of doing business. In fact, conducting business will become far easier and more seamless. As GST is levied consistently across all categories of goods and services, GST registration and online payment will eventually make it easy for entrepreneurs to pay tax.
Click Here To Know More About GST Registration Documents
- Impact of GST on Inflation-Another thing to know about GST is that during the initial stages of the entrepreneurship period, the inflation rate will be quite high but will eventually be under control in the long run. As a result of GST, the economic growth will increase by 1%-2%, which will benefit all parties involved.
- Claiming Income Tax Credit – In order to claim the income tax credit or the input tax credit against the buying and selling of goods and services, the entrepreneur will have to compulsorily share the GST number with the vendor.
- Payment of GST and Filing Return-In order to file tax returns on the GST portal, all entrepreneurs will have to pay taxes. Last but not least, you have to do this every month. Tax returns can be filed on a quarterly basis by entities with a turnover up to 5 crores, but tax payments have to be made on a monthly basis.
- Payment of GST under RCM-Suppliers are responsible for paying tax to recipients through RCM (Reverse Charge Mechanism). After the supplier fails to pay the tax, the recipient is responsible for paying it. GST payments are re-accountable as a result. A GTA, an advocate, and a tribunal are all covered by RCM, but unregistered dealers cannot supply more than 5000 rupees of goods.
- Composition Scheme-Due to this scheme, small businesses will pay taxes on only 1% to 6% of their revenue. GST’s composition scheme is available to small manufacturers and suppliers with turnovers below Rs 1.5 crores. A further reduction to Rs. 75 lakhs applies to special category states.
- GST Compliance Rating-Compliance with GST regulations and rules determines a business’s GST compliance score. This score will be accessible to all businesses. Scores are not influenced by business size, turnover, or type. GST compliance, for example, shows businesses’ compliance level on a scale of 1-10, with 10 representing complete compliance and 1 representing noncompliance.
The growth of India’s economy depends heavily on SMEs. Indirect taxes will be streamlined under Goods and Services Tax as a multitude of taxes will be digitized and simplified. The above-mentioned GST aspects should be thoroughly understood by budding entrepreneurs in order to run a successful business.