gst - impact, development and compliances
TRANSCRIPT
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
01 GST Overview
02
03
04
Today’s Agenda
Impact on various sectors
Glimpse on GST Development
Compliances
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
Sale Transfer Barter Exchange
Activities Specified in Schedule II
Activities Specified in Schedule I
SupplyIncludes
Supply Includes:
Import of Service for Consideration
Licence Rental Lease Disposal
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SupplyExcludes
Supply Excludes:Service by employer to employee in course of employment
Service by Court or Tribunal
Activities undertaken by
CG/SG/LA engaged as
Public Authorities
Sale of land, Building
Service of funeral, burial, crematorium
or mortuary including transportation of
deceased
Actionable Claim other than
lottery, betting and gambling
Functions of MP, Duties performed at post in
constitution, Duties of chairperson , member,
director of body established by govt.
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Input Tax Credit Mechanism
SGST
CGST IGST
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Impact on Businesses
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Manufacturing Industry
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Works Contract
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Sector Wise Impact of GST
Sector Impact on Settingup cost
Impact onOperatingCost
Power
Renewable
Coal
Petroleum
Nuclear
Negative
Indifferent
Positive
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Sector Impact on Settingup cost
Impact on Operating Cost
BOT Projects (Road)Port
Railway
Mining
Negative
Indifferent
Positive
Sector Wise Impact of GST
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Mining SectorCurrent Tax Scenario:-
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Mining SectorGST Regime:-
Merchant Mining –Positive Impact
Merchant Mining Cum Manufacturing – Neutral
Particulars
Merchant Mining Sector
Mining Cum Manufacturing
Sector
Tax levied
Cenvatcredit
Available
Tax levied
Cenvatcredit
Available
Supply of Services :-
Exploration of Mines ✔ ✔ ✔ ✔
Handling of Mines ✔ ✔ ✔ ✔
Transportation of Mines ✔ ✔ ✔ ✔
Grant for mining lease ✔ ✔ ✔ ✔
Outward supply - Intrastate ✔ ✔ ✔ ✔
Value Added Tax on outward supply
✔ ✔ ✔ ✔
Outward supply - Interstate ✔ ✔ ✔ ✔
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Textile Industry
Pre GST Regime
Post GST Regime
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Automobile Industry
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RetailersRetailers
Particulars Pre GST Regime Post GST Regime
Value of Goods 1000 1000
Add:- Excise Duty @ 12% 120 -
Cost to Retailer 1120 1000
Add:- VAT @15% 168 -
Add:- GST @18% - 180
Total Value to Retailer 1,288 1180
Net Impact 108 8.39%
Positive Impact
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GST Updates
Notifications
Circulars
Press Release
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CGST Notification
Supplier
Providing Taxable Supplies covered
under RCM
Exempt from Registration
Notification No – 05/2017Date – 19/06/2017
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CGST Notification
Notification No –08/2017
Date – 27/06/2017
Turnover for opting for Composition Scheme
Rs. 75 Lakhs in Preceding F.Y.
Tax Rates for Composition Scheme
Manufacturer – 1% of turnover
Entry 6(b) of Schedule II – 2.5% of turnover
Other Suppliers – 0.5% of turnover
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CGST Notification
Notification No – 12/2017Date – 28/06/2017
Number of HSN digits required on tax invoice
Turnover in Prev
Year upto Rs. 1.5 Cr
Turnover in Prev Year more than
Rs. 5 Cr
Turnover in Prev Year
more than Rs. 1.5 Cr but
upto Rs. 5 Cr
Not Required
4 Digits
2 Digits
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CGST NotificationInterest on
Late payment of
Tax
• 18%
Interest on wrong
availment of ITC
• 24%
Interest on withheld refunds
• 6%
Interest on Delayed Refund
• 6%
Interest on refund
arising from appeals
• 9%
Notification No – 13/2017Date – 28/06/2017
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
CGST Notification
Categories of persons eligible for Letter of
Undertaking in place of bond
A status Holder as specified in Para 5 of Foreign Trade Policy 2015-2020
Person who has received due foreign inward remittances amounting to min of
10% of export turnover, which should not be less than Rs. 1 Cr in Preceding FY
Notification No – 16/2017Date – 07/07/2017
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CGST Notification (Rate)
Services by way of
Transportation of passenger by radio taxi, motor cab, maxi cab and motor
cycle
Accommodation in hotels, inns, guest houses, clubs, campsite or other
commercial places meant for residential or lodging purposes
Tax Payable by E-
Commerce Operator
Notification No – 17/2017Date – 28/06/2017
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
CGST Notification (Rate)Notification No – 15/2017
Date – 28/06/2017
No refund of unutilized ITC will be available under Section 54(3) of CGST Act when providing services specified in Paragraph 5(b) of Schedule II to CGST Act i.e. Construction Services.
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CGST Notification (Rate)Notification No – 13/2017
Date – 28/06/2017
Service Provider Recipient
Goods TransportAgency Service
Goods Transport Agency
1. Factory registered under Factories Act 19482. Society registered under Societies Registration Act
1860 or any other law in force3. Co-operative societies established under any law4. Any registered person under this Act5. Body corporate established under any law6. Partnership Firm including AOP7. Casual taxable person in taxable territory
Reverse Charge
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CGST Notification (Rate)…(cont) Notification No – 13/2017Date – 28/06/2017
Service Provider Recipient
Legal Consultancy Service
Advocate / Senior Advocate/ Firm of Advocates
Any business entity located in taxable territory
ArbitralTribunal Services
An Arbitral Tribunal
Any business entity located in taxable territory
Sponsorship Service
Any Person Body Corporate or Partnership Firm
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Notification No – 13/2017Date – 28/06/2017
Service Provider Recipient
Government Services
Central Government / State Government / Union Territory or Local Authority
Any business entity located in taxableterritory
Director Service
Director of Company or Body Corporate
Company or Body Corporate located in taxable territory
Insurance Service
Insurance Agent Any person carrying on Insurance Business
CGST Notification (Rate)…(cont)
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
Notification No – 13/2017Date – 28/06/2017
Service Provider Recipient
Recovery Agent Service
Recovery Agent Banking Company or Non-Banking Company or NBFC
Service of transferring or permitting to use copyright
Author,Music Composer,Photographer,Artist,or the like
Publisher,Music Company,Producer,or the like
CGST Notification (Rate)…(cont)
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CGST Notification (Rate)
• Prescribes Exemption List under CGST Act
Notification No – 12/2017Date – 28/06/2017
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
CGST Notification (Rate)
• Exemption to dealers operating under Marginal Scheme
Exemption from CGST payable on Intra-State receipt of second hand goods from unregistered dealers
Notification No –10/2017
Date – 28/06/2017
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
CGST Notification (Rate)
No deduction of TDS in case of intra-state supplies of goods or services or both received by a deductor u/s 51 of CGST Act provided that deductor is not liable to registration other than as per Section 24(vi)
Notification No –09/2017
Date – 28/06/2017
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
CGST Notification (Rate)
Intra-State supplies from Unregistered
Person does not exceeds Rs.
5,000/- per day
No RCM Applicable
Notification No –08/2017
Date – 28/06/2017
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
CGST Notification (Rate) Notification No –04/2017
Date – 28/06/2017Reverse Charge
Goods Provider Recipient
Cashew Nuts, not shelled or peeled
Agriculturist Any registered person
Bidi wrapper leaves (tendu)
Agriculturist Any registered person
Tobacco Leaves Agriculturist Any registered person
Silk Yarn Manufacturer of silk yarn from raw silk or worm cocoons
Any registered person
Supply of lottery SG, UT, or any LA Lottery distributor or selling agent
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Press Release
Date Particulars
15th June 2017 Lower Tax Incidences on Complex, Building, Flat etc.
18th June 2017 Relaxation in return filing for 1st two months
15th July 2017 Applicability of GST on Legal Services
15th July 2017 Applicability of Margin Scheme on Second Hand Goods
17th July 2017 Increase in Compensation Cess on Cigarettes
18th July 2017 Rate of tax on accommodation in hotels including 5 star hotels
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Lower Tax Incidences on Complex, Building, Flats etc
The press note states that the builder who are presently under apractice of calling the entire booking amount pre-GST on accountof increased rate is against the GST Law.
Builders are liable to pass on the benefits of lower tax burdenunder the GST regime to the buyers of property by way of reducedprices/ installments on account of reductions in credit blockages.
Therefore, builders / construction companies cannot askcustomers to pay higher tax rate on instalments to be receivedafter imposition of GST.
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Return for first two months
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GST on Legal Service
Legal services provided by advocate, senior advocate or firm ofadvocates are liable for payment of GST under reverse charge bythe business entity.
The words “by way of representational services before any court,tribunal or authority….” appear in conjunction with senioradvocate and merely describe the nature and mode ofrepresentational services provided by a senior advocate to abusiness entity.
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Applicability of Margin Scheme on Second Hand Goods
Value of supply for second hand goods shall be the differencebetween the selling price and the purchase price and where thevalue of such supply is negative, it shall be ignored. This is knownas the margin scheme.
This press release specifies notification which exempts CentralTax leviable on intra-State supplies of second hand goodsreceived by a registered person, dealing in buying and selling ofsecond hand goods from any supplier, who is not registered asITC will not be available on purchases of second hand goods.
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Registration of Traders
Registered under any of the existing law
Migrated
Liable for registration in GST regime
Provisional Ids issued need to be converted to GSTIN by submitting necessary documents in 3 months (i.e. by 22nd September 2017)
Not liable for registration in GST regime
Need to apply for cancellation in 30 days(i.e. by 22nd July, 2017)
Not-Migrated
Liable for registration in GST regime
Need to apply for registration within 30 days (i.e. by 22nd July, 2017)
Not registered under any of existing law
Liable for registration in GST regime
Become liable from 01/07/2017
Need to apply for registration within 30 days (i.e. by 30thJuly, 2017)
Become liable after 01/07/2017
Need to apply for registration within 30 days from becoming liable for registration
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GST on Hotels including 5 Star Hotel
GST on accommodation in hotels including 5-star hotel,where tariff is less than Rs. 7500 for per day per unit is 18%.
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Compliances
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Registration
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Persons Liable for Registration
Aggregate Turnover Exceeds Rs. 20 Lakhs (10 Lakhs for Special
Category States)
Transferee liable to registration if Business Transferred as a going
concern
Registered under Earlier law Subsumed
in GST
Amalgamation/Merger/ Demerger pursuant to an order of High court,
tribunal
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Persons Not Liable for Registration
Persons Not Liable for
Registration
Supplying Exempt goods or services or both
Supplying goods or services or
both not liable to tax under this Act
Agriculturist, to the extent of
supply of produce out of cultivation
of land
Persons as may be notified by
Government
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Compulsory Registration
Person making Inter-State Taxable Supply
Casual Taxable Person making Taxable supply
Person required to pay under RCM
Person liable to pay u/s 9(5) – E-Commerce Operator
Non-Resident Taxable Person
TDS Deductors
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Compulsory Registration…(Cont.)
Agent
Input Service Distributor
Supplier making supply through E-Commerce Operator
E-Commerce Operator
Supplier of Online Information and Database Access or Retrieval
Person as may be notified
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Special Provisions under Registration
Casual Taxable Person
Person who occasionally undertakes transactions
involving supply of goods and / or services in the
course or furtherance of business, in a taxable
territory where he has no fixed place of
business.
Non-Resident Taxable Person
Person who occasionally, undertakes transactions
involving supply of goods and services, and who has no fixed place of
business in India.
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Returns
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Return Types
Return No. Particular Due Date Applicable for
GSTR-1 Outward Supplies 10th of next month Regular Taxpayer
GSTR-2 Inward Supplies 15th of next month Regular Taxpayer
GSTR-3 Monthly Return 20th of next month Regular Taxpayer
GSTR-4 Quarterly Return 18th of next quarter Composition Taxpayer
GSTR-5 Return by Non-Resident Taxpayer
20th of next month or 7 days after expiry of registration
Non-Resident Taxpayer
GSTR-5A Online Information and Database Access
20th of next month Online Information and Database Access
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Return Types
Return No. Particular Due Date Applicable for
GSTR-6 Return by Input Service Distributor
13th of next month Input service Distributor
GSTR-7 TDS 10th of next month Tax Deductor
GSTR-8 TCS 10th of next month E-Commerce
GSTR-9 Annual Return 31st of next F.Y. Regular Taxpayer
GSTR-9A Annual Return 31st of next F.Y. Composition Taxpayer
GSTR-9B Annual Return 31st of next F.Y. E-Commerce
GSTR-9C Annual Return 31st of next F.Y. Aggregate Turnover > Rs. 2 Cr.
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Return Process
Supplier Uploads GSTR-1
(upto 10th of next month)
Auto-drafted GSTR-2A based on details from GSTR-1 filed by suppliers
(after 10th of next month)
Generate GSTR-2 by accepting /
rejecting / modifying details
from GSTR-2A
(After 10th but upto 15th
of next month)
Add missing purchase invoices
(By Recipient)
Supplier to accept modifications
(by 17th but not before 15th )
General net tax: Pay / carried
forward in GSTR 3
(By 20th of next month)
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Matching of ITC Matchings shall be done after due date of
GSTR-3
GSTIN of Supplier
Invoice or Debit Note Date
GSTIN of Recipient
Invoice or Debit Note Number
Tax Amount
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Supplier / ReceiverPortal
Recipient / Supplier
In FORM GST MIS - 1
Final Acceptance and Communication thereof
Where above details are matched
Communicate the acceptance through
SupplierPortalRecipient
Rectifies and matches ITC after communication
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DiscrepancyWhere ITC
claimed is not matched
Added ITC but supplier did not mention the details of supply or details mentioned are not declared by supplier
SupplierRecipient
Did not rectified the same
Added to output liability of recipient
Communicated to Recipient in FORM
GST MIS - 1
Communicated to Supplier in FORM
GST MIS - 2
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Claim of ITC on same invoice more than once
ITC claimed more than
once on same invoice
Communicate to
Registered Person in form
GST MIS - 1
Through
Portal
* If not rectified within 2 months than added to output liability of recipient
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Matching & Claim of Output Liability Matchings shall
be done after due date of GSTR-3
GSTIN of Supplier
Credit Note DateGSTIN of Recipient
Credit Note Number
Tax Amount
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Final Acceptance of reduction in output liability and Communication thereof
Where above details are matched
Communicate the acceptance through
Supplier /
ReceiverPortal
Recipient / Supplier
In FORM GST MIS - 1
Rectifies and matches after
communication
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
DiscrepancyWhere ITC claimed is not matched
Output liability reduced does not match with supplier and not rectified in his return
SupplierRecipient
Did not rectified the same
Added to output liability
Communicated to Supplier in FORM GST
MIS - 1
Communicated to Recipient in FORM GST
MIS - 2
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
Reduction in output tax liability more than once
ITC claimed more than
once on same invoice
Communicate to
Registered Person in form
GST MIS - 1
Through
Portal
Prepared by – Nikita Lakhotia, Naimish PadhiarSandesh Mundra & Associates – [email protected]
Sandesh Mundra & AssociatesChartered Accountants
www.smaca.in
304, Super Plaza, Near Prakash High School, Sandesh Press Road, Vastrapur, Ahmedabad
[email protected] 079-40032950