Composition scheme in GST is beneficial to small taxpayers whose aggregate turnover is not more than Rs 150 lakhs. For northeastern states the limit is Rs 75 lakhs. The benefit of opting a composition scheme is that you are not required to pay GST at normal rates and certain compliance are not applicable. In this article, we will be discussing GST rates applicable to a … [Read more...] about GST rates applicable to composition scheme suppliers
GST - Goods and Services Tax
What is inter-state supply of goods and/or services under GST
GST law clearly says when supplies of goods and/or services shall be treated as in the course of inter-state trade/commerce and when it should be treated as in the course of intra-state trade/commerce. This differentiation is important as based on it, GST will be levied. As per section 7 of the IGST Act, a supply of goods and/or services will be treated as a supply in the … [Read more...] about What is inter-state supply of goods and/or services under GST
What is intra-state supply of goods and/or services under GST
Section 8 of IGST Act, 2017 says when supply of goods and/or services will be treated as intra-state supply. As per section 8, supply of goods will be treated as Intra-state supplies if the location of the supplier and the place of supply of goods are in the same state or same union territory. Here are three exceptions to the above provisions- Supply of goods to … [Read more...] about What is intra-state supply of goods and/or services under GST
What is reverse charge mechanism under GST and its applicability
Reverse charge mechanism is a new concept introduced in GST. As per GST law, the supplier of goods or services is liable to pay tax. However, under reverse charge mechanism, the recipient of goods and/or services shall be required to pay CGST and SGST/UTGST on intra-state sales or IGST on inter-state sales if following conditions are fulfilled- Goods or services or both as … [Read more...] about What is reverse charge mechanism under GST and its applicability
When composition scheme under GST law is applicable
Small suppliers whose aggregate turnover from supplying goods for a year is less than Rs 40 lakhs are not required to register under GST. This limit is Rs 20 lakhs for supply of services and Rs 10 lakhs for north east states. However, if you have taken registration under the GST law, then you are liable to pay goods and services tax based on supplies irrespective of your … [Read more...] about When composition scheme under GST law is applicable
Can You avail Input tax credit on capital goods under GST law
Input tax credit for GST paid on capital goods is allowed in the first year itself as it is considered as goods. In this article, we will be discussing what is a capital asset and how to avail input tax credit of GST paid on capital goods and what are the exceptions. As per section 2(19) of CGST Act, capital goods means goods, the value of which is capitalised in the books … [Read more...] about Can You avail Input tax credit on capital goods under GST law
When input tax credit shall not be allowed under GST law
Goods and services tax has been implemented in India to get rid of the cascading effect of tax under the earlier indirect tax regime. Therefore, input tax credit is allowed under different circumstances to registered taxable persons if certain conditions as specified under the law are satisfied. However, this law has certain provisions where a registered taxable person is not … [Read more...] about When input tax credit shall not be allowed under GST law
ITC on inputs in stock when exempted supply become taxable
Where an exempt supply of goods and/or services by a registered person becomes a taxable supply, such person shall be entitled to take; credit of input tax in respect of inputs held in stock relatable to such exempt supply; and inputs contained in semi finished or finished goods held in stock relatable to such exempt supply;Inputs on capital goods exclusively used for … [Read more...] about ITC on inputs in stock when exempted supply become taxable
Entitlement of ITC on inputs in stock on exiting composition levy
If a person ceases to pay tax under composition scheme U/s 10 then, that person shall be entitled to take credit of input tax in respect of inputs held in stock, inputs contained in semi-finished or finished goods held in stock and on capital goods on the day immediately preceding the date from which he becomes liable to pay tax as per normal / regular scheme u/s 9. This means, … [Read more...] about Entitlement of ITC on inputs in stock on exiting composition levy
Entitlement of ITC or Input tax credit in stock at the time of GST registration
In our last article we have discussed how to take GST registration in India, when you should register yourself under goods and services tax law and what are the documents you require to avail input tax credit. In this article, we will be discussing your entitlement of input tax credit in stock when you register under GST law. A person who has applied for GST registration … [Read more...] about Entitlement of ITC or Input tax credit in stock at the time of GST registration