What is GST?

Think of GST as a single tax levied on the supply of goods and services. It essentially replaced a multitude of indirect taxes previously levied at the central and state levels, aiming to create a seamless and transparent taxation system.

Benefits of GST:

• Simplified Tax Structure: Eliminates cascading taxes, reducing the overall tax burden on businesses and consumers.
• Improved Compliance: Encourages transparency and discourages tax evasion due to a centralized system.
• Enhanced Efficiency: Streamlines the movement of goods across states, fostering economic activity.

Key Concepts of GST:

• GST Rate: The tax rate levied on the supply of goods and services. Different rates (0%, 5%, 12%, 18%, and 28%) apply to various categories.
• Input Tax Credit (ITC): Allows businesses to claim credit for the GST paid on their purchases, reducing the final tax liability.
• HSN Code: A harmonized system code used to classify goods for tax purposes.
• GSTIN: A unique identification number assigned to every registered taxpayer.

Who needs to register for GST?

Businesses with a turnover exceeding ₹20 lakh (₹40 lakh in certain special cases) are generally mandated to register for GST.

Compliances under GST:

• Filing GST returns: Regular filing of returns to report transactions and tax liabilities.
• Issuing invoices: Providing proper invoices with all mandatory details for every supply made.
• Making tax payments: Timely payment of GST based on the tax liability calculated.