The main features of GST Registration/goods and service tax (GST) in India is its continuous chain of Input Tax Credit (ITC). Nowadays the indirect taxation and cascading of tax are noteworthy because of the non-availability of ITC at various stages. For example, ITC of CTC, luxury tax, etc is not available. Similarly, the ITC of tax, etc is not available. Similarly, the ITC of CTC is not available for VAT is not available to manufacturers and service providers and ITC of central excise duty, service tax & CVD is not admissible to dealers in goods. Additionally, Under the GST law, ITC will follow the supply chain not only in the intrastate transactions but also in interstate transactions. Additionally, when the time of import of goods and service the credit of tax paid also credible. The significant reduction of cascading of taxes may happen in the time of import and exportation.
The GST Act section 16 to section 21 passed on 12th April 2017, in discussion with the provision of the input tax credit. Probably, The Cenvat credit rule 2004 is mainly using for the detailed provisions related to the cenvat credit and these things are happening in the pre GST era. The cenvat credit mainly handled by the rule. Conversely, The main provisions relating to the GST rule or ITC may be deal with by section 16 along with other sections and read with various rules to place in the public domain. In addition, The GST rule enables utilization principles of ITC and seeks to communicate clearly so we can minimize the disputes.
Conditions obtaining for ITC
- He must be in control of the tax invoice or any debit notice issuing by the supplier who registered under this act or any other taxpaying documents.
- He must receive the goods and services
- Moreover, The GST tax applicable for such supply has been actually paying to the government, either in cash or through the utilization of input tax credit.
- He must furnish the return under section 39.
Time input limit for taking ITC on GST Registration
Regarding the section 16 of the GST Act, ITC cannot add beyond the month of September of the below FY to which invoice pertains or date of filing of annual return whichever is easier. In consist, The underlying reason for this restrictions is that no change permits after September of next FY. Identically, If the annual return is filing before September then we can’t able to amend the changes after filing of annual return.
- Negative list on which Input Tax Credit is not permitted
- Section 17 of the GST Act provides some negative list with respect to the allowable data of ITC. It states that the ITC on the following items cannot be avail.
- Motor vehicles and other transportation exclude when they are using
- Similarly, For making the following taxable supplies.
- Transportation of passengers
- Training of driving, flying, navigation of such vehicles.
- Supply of vehicles
- Transportation of goods
- Below are some examples of the supply of goods and services and it includes,
Foods, drinks, catering, beauty treatment, cosmetics, plastic surgery items except for all the exporting business of goods and services.
- Members of a health, fitness center, membership
- Rent a car, life insurance, health insurance.
- Likewise, The employer must provide certain laws to its employees under some company laws in accordance with government.
- The hidden supply and marketing of goods and services from a registered person to the exporting business of goods and services.
- The benefits of vacation traveling extended to employees, like family tour, leave, etc.
- Work Contract services when supply for the permanent property construction apart from machinery products.
- Furthermore, The taxable person receives some goods and services for their own account for the manufacturing of some properties.
- The word construction has more synonyms like rebuilding, addition, upgrading, etc.
- The tax paid under section 10 of goods and services.
- Goods and services used for personal consumption.
- Any lax is liable for section 74, 129, 130.
- The person can entitle the credit of inputs held in stocks only if he applied for the registration within 30 days. If he is not taking within 30 days then the ITC on the opening stock is not available.
- The goods and services are using by the registered taxable person party for the purpose of any business or another purpose, and then the amount of credit shall restrict to the input tax to the purpose of his business.
- Where the goods and services are using by the registered taxable person for getting taxable supplies including zero counted supplies and partly the amount of credit shall revert proportionately to the exempt supply.
- A banking company including an NBFC, engaged in extending loans shall have the option to reverse the amount equal to 50% of the eligible input tax credit on inputs, capital goods, and services.
- Mechanism of distribution of credit by Input service distributor specified in section 20 of GST.
Assorted input terms of ITC on GST Registration
- Tax Credit Mechanism
- Payment Mechanism
In modern taxation season, every transaction of GST Registration is transparent and simple with the tax administration. There is some experience in the administration that more the system and procedure are making electronically to get the satisfaction of the taxpayer. The IT can be handling both the receipt and payment process and is uses for the GST filing.
Section 49 of the GST Act, 2017 Deals with payment of tax, interest, penalty and other amounts. The joint committee on the business process of GST payment process may release its report on April 2015.
The major features of this payment process is giving below,
- Non-generation of the paper at any stage of the company, because it is an electronic payment.
- Single point interface for challan generation- GSTIN
- Ease of payment- payment can make through credit/debit cards, online banking, NEFT, Cash, etc.
- Common challan form with auto-population features
- Usage of the single challan and single payment instrument
- The common set of the authorized bank
- Common accounting codes
- Basis of Section 9 of GST, 2017 the collection of GST may make regarding the below reasons:-
- General Rule: – Responsibility on goods and service suppliers or GST Registration input to pay GST.
- Full reverse charge: – The reverse charge mechanism has the main impact on the Responsibility of the receiver of the goods to pay GST.
- The mode of payment of GST may describe in the rules. Further, the joint committee on the business for GST has released its report on GST payment.
- The payment process of GST have such features and is describes in the below part.
- Electronic challan from GSTIN
- The registration atmosphere is hassle-free and the mode of payment is anywhere at any time.
- Convenience of online payment mode
- Legal tax collection in electronic mode
- Transactions are electronically and do not require any paper.
- Fast accounting and reporting.
- Simplified banking procedures
- Warehousing of digital challan.
These are the features in the modes of payment. The main 3 payment are discussing below.
- Payment of taxpayers through Internet banking via authorized bank and through credit and debit card.
- Over the Counter payment through (OTC) authorized bank
- Payment transaction via NEFT/RTGS from any bank.
The book adjustment paying modes is the recent one and are allowing by Govt.of India to export scrip while paying tax won’t be allowed in some particular departments.
E-Ledgers are particularly known as an electronic ledger. It means it is a statement of cash and input tax credit in respect of each registered taxpayer. Each taxpayer also has an electronic tax liability register. The registration occurs by common portals and an electronic tax liability register will automatically open and displayed in the taxpayer’s personal dashboard options at all time.
Tax Liability Register:
It is denoting the total tax liability of a particular person on the concerned month.
It reflects all deposits made in cash, TDS/TCS made4 in the account of the taxpayer. On the Real-time basis, all the information are reflecting.
This method is using for making any type of payment on account of the GST.
Registration under GST
The provision of the registration is containing from section 22 to 23 of the GST Act 2017. As per the provision, every taxpayer who is responsible to register under this act shall apply for registration in every state within 30 days of the registration. Obtaining the unique identification input code from the concerning tax authorities are the main importance of filing a business or GST Registration with the tax authorities thus all the operations can modify and cancel in regard with GST. The most fundamental thing of a tax system is the identification of the business.
The registration under GST has the following advantages.
- Supplier of goods and services are recognizing as Legally
- For the payment of GST proper accounting of goods and services are requiring.
- Pass on the credit of tax paid on the goods and services supplies to purchase or recipients.
Registering the GST in regard to goods and service is mandatory. We all have to pay GST directly to the government. Through GST payment we are saving our nations and we joining the formation of our nations’ infrastructure. Be unique. If you want to register your GST easily with the considerable cost you can reach Corpstore, the leading business consultants in Coimbatore. Our services include IEC code registration, SSI/MSME Registration, FSSAI Registration, ISO Certifications