Summary
We at HARDIK ROHIT & CO LLP can help you to get your GST Registration.
GST is an indirect tax that was formed to abolish several other indirect taxes in India, to create a single taxation regime for ease of collection and to increase the efficiency of the process. GST Registration is mandatory for every business or corporation involved in buying and selling of goods or services. Those with an annual turnover of more than 20 lakh rupees for supply of services and 40 lakh rupees in case of supply of goods is the threshold limit. Goods and services tax (GST) was rolled out in India with effect from 1st July 2017. GST is one of the greatest tax reforms in India. It transforms the system of taxation and tax administration into a digital world by adopting the latest information technology.
GST can be divided into four sections, based on the kind of transaction it involves. Before a business can determine its GST liability, assessing the following table is essential.
- CGST (Central Goods and Services tax) = CGST stands for Central Goods and Services tax. It replaced all the previous taxes under the Central Government. Some examples of such taxes are central surcharges & cess and central excise duty. CGST is levied on the movement of goods within a state.
- SGST (State Goods and Services tax) The GST collected by the State Government is known as SGST, which is applicable on transactions within its geographical boundaries. Under the new tax regime, previous state taxes like entertainment tax, VAT, and State Sales tax became non-functional. SGST stands for State Goods and Services tax, a single tax levied on intrastate supplies of goods and services, except for alcoholic liquor. It can be charged solely on a product transactional value – an amount the buyer needs to pay.
- IGST (Integrated Goods and Services tax) = IGST stands for Integrated Goods and Services tax. It is generally applicable during interstate transactions, i.e., transactions between two different states. Among the types of GST, levied on supplies of products and services between two states and even on exports and imports (IGST + customs). The Central Government is responsible for its collection as per the IGST Act.
- UTGST (Union Territory Goods and Services tax ) = UTGST stands for Union Territory Goods and Services tax, applicable to the transaction of goods and services in the Union Territories. It is levied on the supply of products in Andaman and Nicobar Islands, Lakshadweep, Daman Diu, Chandigarh, and Dadra and Nagar Haveli.
Characteristics
BENEFITS AND CHARACTERISTICS OF GST REGISTRATION
1. GST eliminates the cascading effect of tax
The introduction of GST has eliminated the previously noted cascading effect in indirect taxation, causing double taxation in every step. This measure has lowered the tax liability of business entities.
2. Simple and easy online procedure
The entire process of GST (from registration to filing returns) is made online, and it is super simple. This has been beneficial for start-ups especially, as they do not have to run from pillar to post to get different registrations such as VAT, excise, and service tax
3. Helps in Avoiding Lengthy Taxation Services
GST Registration helps the small businesses in avoiding the lengthy taxation services. As the service providers with a turnover of less than 20 lakhs and goods provider with a turnover of less than 40 lakhs are exempt from paying the GST
4. Minimizing Tax Evasion
With the introduction of GST, tax evasion is minimized to a great extent.
5. Compliances is Lesser in number
Previously, there was VAT & service tax, each of which had its own returns & compliances. Under GST, on the other hand, there is just one, unified return to be filed.
6. Reduction in Costs of Products & Services
With the introduction of GST, the cascading effect of a series of VATs and taxes has been erased which has resulted in the reduction of cost of goods and services.