GST Billing software In kerala

GST has brought in ‘one nation one tax’ system, but its effect on various industries is slightly different. The first level of differentiation will come in depending on whether the industry deals with manufacturing, distributing and retailing or is providing a service.

Impact of GST on Manufacturers, Distributor, and Retailers

GST is a boost competitiveness and performance in India’s manufacturing sector. Declining exports and high infrastructure spending are just some of the concerns of this sector. Multiple indirect taxes had also increased the administrative costs for manufacturers and distributors and with GST in place, the compliance burden has eased and this sector will grow more strongly.But due to GST business which was not under the tax bracket previously will now have to register. This will lead to lesser tax evasion.Impact of GST on Service ProvidersAs of March 2014, there were 12, 76,861 service tax assessees in the country out of which only the top 50 paid more than 50% of the tax collected nationwide. Most of the tax burden is borne by domains such as IT services, telecommunication services, the Insurance industry, business support services, Banking and Financial services, etc. These pan-India businesses already work in a unified market and will see compliance burden becoming lesser. But they will have to separately register every place of business in each state.Sector-wise Impact AnalysisLogisticsIn a vast country like India, the logistics sector forms the backbone of the economy. We can fairly assume that a well organized and mature logistics industry has the potential to leapfrog the “Make In India” initiative of the Government of India to its desired position.E-commerceThe e-commerce sector in India has been growing by leaps and bounds. In many ways, GST will help the e-com sector’s continued growth but the long-term effects will be particularly interesting because the GST law specifically proposes a Tax Collection at Source (TCS) mechanism, which e-com companies are not too happy with. The current rate of TCS is at 1%.PharmaOn the whole, GST is benefiting the pharma and healthcare industries. It will create a level playing field for generic drug makers, boost medical tourism and simplify the tax structure. If there is any concern whatsoever, then it relates to the pricing structure (as per latest news). The pharma sector is hoping for a tax respite as it will make affordable healthcare easier to access by all.TelecommunicationsIn the telecom sector, prices will come down after GST. Manufacturers will save on costs through efficient management of inventory and by consolidating their warehouses. Handset manufacturers will find it easier to sell their equipment as GST has negated the need to set up state-specific entities, and transfer stocks. The will also save up on logistics costs.TextileThe Indian textile industry provides employment to a large number of skilled and unskilled workers in the country. It contributes about 10% of the total annual export, and this value is likely to increase under GST. GST would affect the cotton value chain of the textile industry which is chosen by most small medium enterprises as it previously attracted zero central excise duty (under optional route).Real EstateThe real estate sector is one of the most pivotal sectors of the Indian economy, playing an important role in employment generation in India. The impact of GST on the real estate sector cannot be fully assessed as it largely depends on the tax rates. However, the sector will see substantial benefits from GST implementation, as it has brought to the industry much-required transparency and accountability.AgricultureThe agricultural sector is the largest contributing sector the overall Indian GDP. It covers around 16% of Indian GDP. One of the major issues faced by the agricultural sector is the transportation of agri-products across state lines all over India. GST will resolve the issue of transportation. FMCGThe FMCG sector is experiencing significant savings in logistics and distribution costs as the GST has eliminated the need for multiple sales depots. FreelancersFreelancing in India is still a nascent industry and the rules and regulations for this chaotic industry are still up in the air. But with GST, it will become much easier for freelancers to file their taxes as they can easily do it online. They are taxed as service providers, and the new tax structure has brought about coherence and accountability in this sector.AutomobilesThe automobile industry in India is a vast business producing a large number of cars annually, fueled mostly by the huge population of the country. Under the previous tax system, there were several taxes applicable to this sector like excise, VAT, sales tax, road tax, motor vehicle tax, registration duty which will be subsumed by GST.StartupsWith increased limits for registration, a DIY compliance model, tax credit on purchases, and a free flow of goods and services, the GST regime truly augurs well for the Indian startup scene. Previously, many Indian states had different VAT laws which were confusing for companies that have a pan-India presence, especially the e-com sector. All of this has changed under GST.

GST Billing software in kerala

Let’s have a look at a short summary of GST’s impact on small businesses in India:

DISADVANTAGES

All invoices from B2B transactions have to be captured and compared to the corresponding party’s records. If there are any discorcondances, input tax credit cannot be claimed.

Implementation will be tough on businesses as they will have to learn on the go. Returns need to be made more often and cash flow might have suffer. GST software will be the key in their day to day operations.

While logistics will get easier for companies that sell goods, businesses in the service sector will suffer more. Currently, service providers need to register once at the central level while GST will require registration in every state such a business operates.

ADVANTAGES

No more tax cascading and applying tax at the total value of the product on each stage of the supply chain. Tax will be applied to value addition at each stage and businesses will be able to claim input tax credit.

Taxes for both Centre and State will be collected at the point of sale and charged only on the manufacturing cost. As prices are likely to come down, consumption will increase, resulting in more production and helping businesses grow.

Interstate movement of goods will get easier. All businesses that need to move goods around the country currently need to keep multiple warehouses in order to reduce tax prices. This won’t be necessary as GST will remove entry state taxes.

Gst billing software in kerala

Aster Billing

HSN Codes for GST in India:

HSN will be applicable in India after implementation of GST. India has already been using HSN system in the Central Excise and Customs regime. 

It is a much more detailed classification that added another two digits to the 6-digit structure. There is a requirement to mention HSN code of items in tax invoice under GST. 

Provisions related to HSN under GST are given below:-

• Now the Govt. has given some relief to small taxpayer with annual turnover up to Rs 1.50 crores in preceding financial year need not be required to mention HSN code in their tax invoice.

• Taxpayers having turnover exceeds Rs. 1.5 crore but up to 5.00 crore will be required to mention only two digits of HSN code.

• Taxpayers having turnover exceeds Rs 5.00 crore will be required to mention four digits of HSN code.

Best Billing software Kerala

What is GSTR 1?

GSTR 1 is a monthly return of outward supplies. Essentially, it is a return showing all the sales transactions of a business.

Who needs to file the GSTR 1?

Every business registered under GST, will have to file the GSTR 1.

What is the due date for filing GSTR 1?

• GSTR 1 for the month of July 2017 is due on 5th September 2017.
• GSTR 1 for the month of August 2017 is due on 20th September 2017.
• Starting from the month of September 2017, GSTR 1 is required to be filed by the 10th of the next month (i.e., 10th October for the month of September, etc.).

Contents of the GSTR 1 form

1. GSTIN of the business.
2. Legal name of the business.
3. Aggregate turnover in the last financial year.
4. Taxable supplies/sales made to registered persons.
5. Taxable supplies/sales made to unregistered persons who are outside of the base state and exceeding Rs 2.5 lakhs (i.e., inter-state sales to unregistered persons, for more than Rs 2.5 lakhs).
6. Zero rated and deemed export sales.
7. Sales made to unregistered persons not covered in section 5 above.
   1. All sales made through an e-commerce operator.
   2. Inter-state sales to unregistered persons upto a value of Rs 2.5 lakhs.
8. Nil rated, exempt and non-GST supplies – Supplies which are exempt and not covered in the above sections.
9. Amendments in taxable sales/supplies made to registered businesses in the previous months.
10. Amendments in taxable sales/supplies made to unregistered businesses in the previous months.
11. Details of advances received or adjusted during the month, from the customers.
12. HSN-wise summary of outward supplies.
13. Documents issued during the month (containing the serial numbers of the invoices, credit notes and debit notes, issued during the month).

Where should one file the GSTR 1 return?

GSTR 1 has to be filed on the GST portal . The government has provided an offline utility to fill the GSTR 1 return and upload it on the GST portal. It can be downloaded from the following link:

GSTR1 utility

One important point to note, is that the GSTR 1 form once submitted, cannot be revised. You can modify the form by amending details in the next month.

GST Billing Software Kerala

Let’s have a look at a short summary of GST’s impact on small businesses in India:

DISADVANTAGES

All invoices from B2B transactions have to be captured and compared to the corresponding party’s records. If there are any discorcondances, input tax credit cannot be claimed.

Implementation will be tough on businesses as they will have to learn on the go. Returns need to be made more often and cash flow might have suffer. GST software will be the key in their day to day operations.

While logistics will get easier for companies that sell goods, businesses in the service sector will suffer more. Currently, service providers need to register once at the central level while GST will require registration in every state such a business operates.

ADVANTAGES

No more tax cascading and applying tax at the total value of the product on each stage of the supply chain. Tax will be applied to value addition at each stage and businesses will be able to claim input tax credit.

Taxes for both Centre and State will be collected at the point of sale and charged only on the manufacturing cost. As prices are likely to come down, consumption will increase, resulting in more production and helping businesses grow.

Interstate movement of goods will get easier. All businesses that need to move goods around the country currently need to keep multiple warehouses in order to reduce tax prices. This won’t be necessary as GST will remove entry state taxes.

GST Billing Software in kerala

The Goods and Services Tax

The constraints which any regulatory agency has in fixing the goods and services tax (GST) rates in a country include the fact that it should be low enough to ensure compliance as well as not cause inflation, and high enough to generate revenue for the government. The concerns which led the GST Council to initially prescribe multiple rates was primarily to generate the same revenue as before, and in that light, keep the effective indirect tax rate on the commodity as close as in the previous jurisdiction. Rate rationalizations over a period of time have tried to bring down the rates in sectors to boost economic activity and move from a high rate of 28% to 18% for most commodities.
In the most recent rate rationalization, the highest tax bracket of 28% has been rationalized further with rates on daily-use items like perfumes, cosmetics, toiletries, hair dryers, shavers, mixer grinder, vacuum cleaners and lithium-ion batteries, being lowered to 18%. For the number of consumer durables like a refrigerator, washing machine, small screen TV, storage water heaters, paints and varnish, the rate has been reduced from 28% to 18%. Then some products like sanitary napkins have been exempted completely while for others like handmade carpets, the rate has been reduced to 5%.
The impact of the reduction of tax rates would be to reduce the price of these commodities. Since most of these are consumer items, this will impact household budgets in a positive way. However, where there is a complete exemption, those goods will not be able to enjoy the credit of input goods and services, which will become a cost and hence, the reduction in prices may not be commensurate with the percentage reduction in GST rates.
The impact of this rate rationalization would be multi-fold. There will be a revenue loss to center and states because of these rationalizations. The total reduction would be roughly 35% (10% of 28%) of the GST collected on these items. However, given that these cuts would need to be passed on to the customer, due to anti-profiteering provisions, the demand and hence the sale of those commodities would increase, following a simple demand-supply curve. Individual commodities may have varying elasticities and the quantum might vary, yet, overall sales of these items would increase. This will give a boost to economic activity in the country leading to an increase in GST and income tax revenue from other sources. For example, a factory starts manufacturing more products, it may need more contract labor, more supply for canteen services, may be hiring more vehicles to ferry and hence, more GST on these supplies. Similarly, paints are a major component of the capital expenditure by government and by corporates and individuals.
A number of items still remain within the 28% bracket, including air conditioners, certain vehicles, engines, etc. The rate structure in the next few years should move towards lower rate brackets, minimum exemptions and if any industry needs to be really benefitted in respect of a particular sector, then instead of exemption, either the goods need to be zero-rated or a minimum rate should be levied to recover the credits accruing in the cost.